4 ms·
Ask HN: I want to build a share dealing company. How could I start?
I want to bring share dealing on the public markets (which is essentially buying and selling a small amount of a company you expect to do well) to people that are otherwise scared off by most stockbrokers intimidating use of terminology and ‘dealer’ focused user experiences.
Through what routes could I begin to trade on the behalf of others? How could I avoid long Know Your Customer practices? What are other barriers might exist, particularly in the UK?
- stevo_perisic 14y agovery interesting question...
- jordn 14y agoIs it possible to bootstrap such a startup? I'd expect the fees to trade directly on the LSE or other markets to be prohibitive, but is there potential to trade through another execution-only stockbroker? From Quora answer re. financial trading APIs in the UK (http://www.quora.com/What-APIs-are-available-for-automated-financial-trading-in-the-UK http://www.quora.com/What-APIs-are-available-for-automated-f...) deposits of the ones mentioned appear to be on the order of £10k+ and if it'd be legal to perform trades on other's behalves.
- ig1 14y agoFind cofounders with the expertise and contacts you need, or at the very least advisors. There's a lot of legal complexity, you'll need to get FSA approval and do things like setup ringed-off accounts to hold client money. Depending on your definition of small you might also need to figure out ways to reduce transactions fees which may mean taking on risk yourself, in which case you'll need to ensure you have suitable risk expertise on your team. One way to make things easier might be to whitelabel an existing brokerage service as a step up to being a full broker.
- jholloway7 14y agoIMO, the ShareBuilder model works well for folks with less capital to invest. The problem I have with it: it lets you automatically dollar-cost-average IN to a holding, but it doesn't let you automatically dollar-cost-average OUT of it. Solve that problem too, please ;)