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Tuesday, June 18, 2024

Stock trading app development: questions to ask yourself before you start

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FinTech — technologies such as software, algorithms, and platforms that are used to extend and optimize financial services, such as bill payments, bank transfers, or more complex processes: management of crypto exchanges, and analysis of customer needs.

Before you start looking for developers to implement your idea, you need to carefully analyze all potential problems and risks. After all, only if you can properly analyze them and understand how to avoid them, can you bring a quality product to the market. How to create a stock trading app?

Choosing the type of app

Before you start creating a stock trading app, you need to choose the type of project and the problems it will solve. Then you should analyze the market and understand if your platform will be useful, if you will offer new functionality to users or if you will simplify some processes. Agree that it is not very interesting and profitable to create a copy of something, but it sounds tempting to occupy an empty niche.

Let’s make a classification and highlight the range of tasks of a stock trading app.

We can classify FinTech as follows:

  • Trading platform;
  • For analytics and forecasts;
  • Automated operations and many more.

Compliance with Legal Requirements

This point is especially important; no one wants to get fined or, worse, go to jail because they haven’t carefully read the legislation. Legal requirements are unique to each country or region. Make sure that you follow all applicable legal requirements and that you have an advisor who can help you enforce those requirements.

There is currently no single approach to the regulation of stock trading apps.

Options for regulation vary widely, from drafting new legislation (Mexico) to new sets of rules (China) to limited changes to individual existing regulations (EU, Korea, Russia, Switzerland, Turkey, UK), to specific rules to regulate particular products and services (Argentina, Hong Kong, India, Indonesia, Pakistan).

Security

Jurisdictions in most countries have identified cyber risks in stock trading apps as a problem for the financial sector. Cybercrime is a serious problem for financial institutions and businesses, even if they provide 100% security of customer data. Such applications have access to vast amounts of personal data and store sensitive information. Therefore, security must be handled responsibly. 

The smallest breach in a system can allow hackers to break in and access information. Consequently, a thorough analysis of the system is necessary, such as checking your system against threats identified by OWASP, to begin with.

Also, there are major security concerns in this area:

  • Data management rights: companies dealing with sensitive data should develop a mechanism to regulate who can access, create, modify, benefit from, sell and delete data, as well as who can grant those rights to others;
  • Identification: tools and algorithms must be developed to accurately identify users, such as two-factor authentication or adaptive authentication;
  • Third-party software: building a modern stock trading app without third-party software, such as payment system APIs, analytics systems, authorization through social networks, etc., seems impossible, but keep in mind that this leads to additional security problems; you need to check the code of third party services and periodically update such software to avoid data leaks.

Usability

The user interface should be smooth and friendly at every stage of user interaction, from registration to completion of the final task. Keep in mind that FinTech products are aimed at a large market and people of all ages, so the user interface should be as easy to understand and use as possible.

You also need to find the right balance between user-friendliness and system features, for example, you need to make sure the security of your app without sacrificing user-friendliness, for example, most stock trading apps allow users to log in with a fingerprint or Face ID, but once a week or once every two weeks the user needs to enter their password.

Basic requirements and trends for FinTech app interfaces:

Text wording — the text should be understandable to everyone without exception, do not forget that not everyone understands trading and certain financial terms, it is necessary to write complex terms in simple language, for example, use cues;

The division of the flows — trading requires a lot of work with the data, you should not overload the interface with multiple forms and fields, divide all the flows into parts, and keep the state between the parts, the user must be able to return to a previously partially completed form to fill it to the end;

Data display — as mentioned above: the stock trading app works with large amounts of data, so you need to display all graphs, reports, and tables with data correctly, you need to think about how all this data will be transferred in parts, so as not to overload the network and interfaces, as was written in the last paragraph.

Using evolving technologies

When developing, you should pay attention to emerging and popular technologies that will strengthen and make your project stand out in the stock trading apps market.

For example, blockchain is one of these technologies. A bit of theory: blockchain is a series of blocks, that record data in hash functions with time stamps so that the data cannot be altered or tampered with.

Based on the above, we can conclude that using this technology will create secure algorithms and protocols secured by cryptography and solve problems such as:

  • Payments;
  • Settlement and settlement;
  • Smart contracts;
  • Identity management and security.

Another example would be using artificial intelligence. Artificial intelligence can solve the problems of risk assessment, market analysis, and forecast, fraud detection, etc.

Conclusion

The above recommendations will help you in stock trading app development. But, the field is constantly evolving and does not stand still; some points can lose relevance tomorrow, so do not ignore the advice of the primary market analysis. Also, do not forget that the problems and their solutions may vary depending on the type of platforms you have chosen and the tasks to be solved. Only a responsible approach to working on a new project can guarantee success. 

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