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How Saxo Bank used open APIs to transform its business model and develop a ground-breaking trading platform

Tom Macaulay | Dec. 15, 2016
SaxoTraderGo - which was built on an open API - has transformed how the company does business.

Updata - which sells its own trade analytics software - is using the technology for sophisticated charting and detecting trading patterns, and a Chinese company has built their own complete separate trading platform on top of the open API. Specialised options trading platforms have been developed where strategies can be defined and options on Saxo Bank traded.

If constraints are placed on the API they're essentially the same as in the UI. Pricing of the data may vary by intended usage and compliance when the identity of the clients, and the provider of the application support aren't always clear can be complex.

"Throttling and business protection is needed on the enterprise, because the APIs get abused, misunderstood, and misused both by accident and on intent," says Andr. "Most of the requests go through the open API, but in some way, shape, or form hit your back-end systems."

Open APIs, he concludes, can help businesses become more digital and support agility, deep integration and innovation. It can let a company transform its business model and develop new platforms and commercial opportunities.

"APIs benefit both your IT development and business development. Make sure to make a chart that appeals to both sides," he suggests. "In our case, latency and frequent requirements have guided us to an off-scale implementation."

The benefits for Saxo have been striking. More than 55 percent of total revenue from private clients is generated from trades on SaxoTraderGO, the bank's most popular platform across all client segments.

"They want more," says Andr of his colleagues. "Not just more. It's more features, it's more things like that."

Saxo Bank's digital model

Saxo Banks' unified open API evolved from an attempt to simplify the architecture standard to produce a common set of services from numerous front-end UIs and services in the back-end. Expenditure and troubleshooting were both expected to benefit from the single interface that would replace the old system.

The real spark for the inception of the open API was the creation of TradingFloor, a social platform for investors to share trading and portfolios.

"[We] wanted to build the next generation trading platform called SaxoTraderGO with a unified user experience, look and feel, across all devices from phones to tablets," says Andr.

"As part of building that platform, it made a lot of sense to have that platform speak to the open API.

"The key lesson here is we got new real business-driven opportunities to introduce this open API not a pure technology play and that made it obviously a lot easier."

Central drivers behind the move included speed, mobility and increased access to data; "share and conquer", as Andr puts it. The platform was designed to be scalable, stable, secure and flexible.

 

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