Forex Innovation

The arrival of faster and more efficient trading systems has reshaped the FX landscape. Yasin Qureshi of Varengold Bank explains how financial technology (fintech) is driving the forex space today.

Founded more than 20 years ago as a small investment bank, then transforming the business via an Initial Public Offering to a fully-fledged commercial bank covering global markets – the history of German Varengold Bank is one of growth. Its FX and Contracts for Difference (CFDs) divisions have been registered with the German Federal Financial Supervisory Authority (BaFin) since 2007. Yasin Qureshi, CEO of Varengold Bank AG, says that rapid advances in technology continuously change the forex marketplace and that the demand for safe and secure eFinancial services has intensified in recent years. “We are seeing an increasing desire by our clients to operate through mobile devices. However, our global client base shows a highly diversified affinity with and willingness to use such devices for executing capital market trades. For example, in the Middle East, it is perfectly normal to see people trading while sipping tea on a terrace. In Northern Europe, our clients tend to find their way to us via a desktop computer.”

Leading Technology

Technology has become a crucial factor for many clients when trading. Varengold has been with MetaTrader since 2007, and it is still their platform of choice. “I have not seen any other company successfully challenging MetaTrader’s market-leading position,” Yasin Qureshi says, adding that Varengold also provides some clients with access to platforms such as Currenex. “Our philosophy has always been to keep investing in back-end efficiency and improved order routing while maintaining flexibility with regard to the client interface.” For the bank to grow and develop, he says, “it is crucial to invest further in technology and seek new fintech solutions in areas such as customer service, reporting and data availability.”

Social Trading

The rise of social media has also left its mark on the trading industry. Varengold Bank AG has partnerships with several social trading platforms, allowing traders to communicate with and follow each other. “We maintain a flexible structure that allows us to collaborate with social trading providers with a view to quickly adapt to market demands,” Yasin Qureshi says.

Institutional FX

While there is no doubt that retail traders have reshaped the forex industry in recent years, he highlights that top-notch technology is the key to attracting institutional investors. “The common denominator on the institutional side of our business is that clients typically need to have trust and confidence in our organisation. In particular, the IT trading platforms need to be stable with adequate risk metrics in place.” The increasingly complex needs of clients also mean “you need to have the flexibility and ability to entertain individual configurations. While we will never forego on process loyalty, we do take time to review requests and genuinely seek ways to make things work in favour of all parties.”

Driving Business Growth

With the implementation of a new IT landscape and dedicated servers, Varengold is currently seeking to improve its performance and acquire new clients. The bank has a very strong retail business covering CFD products in Germany and Spain. “We plan to expand this business into new regions, where we strongly believe that we can create a solid base of potential clients ready to trade, as well as of those who require some training before entering the trading arena.” On the FX and institutional side, Varengold has already expanded strongly into the Middle East and North African region as well as into Eastern Europe and Russia. “However,” Yasin Qureshi says, “we are continually seeking new relationships with Tier 1 clients interested in our solutions – wherever they might be.”