Why Brokers Choose Web-Based Trading Platforms over Desktop Trading Apps
During the first decade of the 2000s, the trading and investment industry started rapidly moving away from desktop trading platforms towards web-based ones. We can’t be sure 100%, but this trend might have been a consequence of or a coincidence with the cloud computing boom that was happening during the same period.
As we know now, web-based trading platforms have eventually overtaken the industry. But has there been a good reason for this? Let’s find out.
Trading platform performance
Desktop trading platforms heavily rely on a user’s device setup: the number of bits in an OS, the amount of RAM, available hard disk space, etc. On top of that, users need to ensure their internet connection and routing speed allow getting quotes and sending orders with subminimal delay, so the choice of a router also matters.
As we see, there are many risk points. If a computer or a laptop isn’t on par with the requirements of a desktop trading app, the probability of the device crashing in the middle of a trading session is way higher.
There’s less risk with web trading platforms because they rely on the calculating capacity of a remote server or a cloud. This way, a user has to worry only about the internet connection and routing speed to receive pricing data without delays and get orders executed without slippage.
Software development challenges
If a broker wants to offer desktop apps, the workload and the number of possible issues multiply. Instead of one web-based app, a broker’s software developers would need to develop two or three desktop trading platforms —for Windows, Mac OS, and Linux—and constantly work on their compatibility with newer versions of these operating systems.
For example, in April 2022, one of the most popular desktop trading platforms was no longer available for macOS users since it was a 32-bit application. The latest versions of macOS Monterey and Big Sur aren’t compatible with 32-bit apps, so the trading platform has become useless. There were some workarounds like emulation software, but honestly, only hardcore traders were willing to give them a shot. Luckily, the platform’s developers eventually fixed the problem. Instead, they could have concentrated on developing new features and tools and improving the platform’s usability.
Developers would also probably need to find this sweet spot when their desktop apps run on most computers (with an “average” setup and not only the top-performing computers with maxed-out RAM and other features).
Some brokers choose not to offer desktop apps for Mac, for example, Interactive Brokers. The alternatives are connecting through an API or installing Windows simulation software, so two operating systems run concurrently on the Mac device. This makes it even slower and more prone to lags and crushes.
Mostly, brokers just don’t offer desktop trading platforms at all anymore.
Mobility
Regarding accessibility on the go, we can’t single out web-based trading platforms. After all, if a person invests or trades using a laptop, they’ll be perfectly fine either by launching a desktop platform or a web-based one.
Web trading platforms might be at an advantage because some of them are adaptable to mobile devices, which makes trading on the go more comfortable. However, we doubt that there are any software vendors and brokers left who care about their clients but don’t have a fully functional mobile trading app in stock.
Our stance and experience
We’ve been in the business of developing trading platforms for the capital markets since 2002.
In 2007, we delivered DealbookWEB, our first web-based trading platform. You can learn more about it here.
We never looked back since then and completely switched to developing web-based trading apps (as opposed to desktop ones). Sometimes, our experts receive questions about whether desktop apps might still be a thing.
Here’s an answer from our Chief Product Officer Evgeny Sorokin:
“In my opinion, a mainstream desktop is dead. However, there are certain firms (and their VIP clients) that prefer desktops for historical reasons or as a matter of habit. There is a vanishingly small number of new cases when a desktop is required: complicated IT landscapes or a limited number of technologies approved by security officers of a particular institution. There is a distinct case of an algo-trading terminal, where users can design, compile, backtest, and optimize their algos. Such solutions are usually delivered as a desktop app. However, the cloud revolution will change that, too.”
Bottomline
The trading and investment industry has shifted from desktop trading platforms to web-based ones for a good reason. Web-based trading platforms have become more prevalent because they rely on remote servers and cloud computing, reducing user reliance on computer setups and allowing trading on the go.
To sum up, web-based trading platforms are better due to their
- Accessibility: they’re available anytime, anywhere, and don’t require installation on devices.
- Cross-device compatibility: synchronization across multiple devices allows investors and traders to start a trade on one device and continue on another seamlessly.
- More accessible updates: platform providers don’t have to worry so much about operation capability because most modern browsers work with web-based trading platforms perfectly fine. Instead, software vendors can focus on ensuring that brokers always have access to the latest features and security improvements without manual updates.
- No need for high-end hardware: web-based platforms are generally less demanding on hardware, making them accessible to traders with a wide range of devices, including older or less powerful ones.
- Compatibility: web-based platforms work across several operating systems (Windows, macOS, and Linux) without needing platform-specific versions.
- Disk space requirements: desktop trading platforms can consume significant disk space, especially if they store historical data. Web trading platforms eliminate this issue, as data is stored in the cloud or on a server.