Year 2016 is coming to an end, Grand Capital has just celebrated its 10th anniversary - it is the time to reflect on the past. CEO of Grand Capital gave an interview to Fortrader magazine, where he shared his thoughts on how the market has been evolving during the past decade: in what way the traders and the market itself have changed and how Grand Capital differs from itself ten years ago. We have prepared a translation of the interview to share it with our English-speaking clients.
Grand Capital celebrates its 10th anniversary this year. Can you tell us what it was like in the beginning? How did you get to know the currency market?
It all started when I was a student, I lived in Saint Petersburg and studied at the University of Architecture and Civil Engineering. Of course, there was never enough money and we had to look for extra means of income, so I got interested in currency speculation. Since then I have been working with the currency market and helping others to invest and earn profit.
The last decade marked a whole era in Russian Forex history. In your opinion, how did the currency market and traders change in that period?
I think that traders don’t change much, but because of the Internet, an average trader looks different now. For example, men used to consider Forex their own domain and didn’t take female traders seriously. Truth be told, there really weren’t many traders among women. Now there are a lot of women in the profession, so the average trader portrait got really prettier in the last ten years. As for the general changes, there have always been traders who study hard, work diligently and strive for progress. Such traders constantly change something — brokers, instruments, their needs. But those who came to Forex just to “play around” burn out fast, the market itself filters out those who are unfit for this kind of business.
And how has the market changed?
The currency market has changed a lot. When I founded Grand Capital in 2006, floor trading was still a thing. Now all you need is to have a smartphone and an Internet access to enter the market. The most important trend in the last few years is that the trading shifts to mobile gadgets. Five years ago, brokers were selling the idea of trading from anywhere in the world, and now “trading on foot” is the trend. Of course, the range of trading instruments broadened in the past few years. For example, CFDs are in high demand now, binary options became universally popular, they quench the thirst for both earning and gambling. The currency market has also changed regulation-wise, countries started to implement more rigid regulatory measures. Hence the market got more robust. The regulation came with security deposits and responsible brokers, and as a consequence, the quality of services improved, the market players became more reliable.
What common problems do brokers face today?
On the modern Forex services market in Russia, there’s a disappointing trend of smear campaigns. Last year was especially marked by energizing of paid “trolls”, they are probably even on a payroll. They leave sample reviews on various websites in great quantities over the same period of time. We identify them as trolls because the attempts to find out the cause of their discontent, or if they are really our clients, yield no results in 99% of cases. Some leave reviews using Facebook accounts, and momentary investigation shows that those are fake pages. It is a very unfortunate tendency. First, there has to be some simple business ethics. Second, there are no reasonable means of adressing this problem, while the reputation of brokers and of the field in general suffers.
In your opinion, has currency trading become customary means of earning and investment in post-Soviet countries? Or is it still considered something exotic and kind of a lottery?
It’s really a lottery for someone who failed once for the lack of knowledge and for those who are unfamiliar with it at all. The cure in these cases is education. Virtually every broker offers a basic education program. For example, in Grand Capital there are several ways of getting free financial education. Exchange Trading School provides theory and practice of trading in the company’s offices. We conduct webinars with our remote education project, Grand Class. A trader can receive training with our Grand School (our partner), program to increase qualification and pass exam to receive FFMS certificate. The concept “trading is exotic” is probably outdated, and as for investment, I think it confidently settled in our everyday life. Frequent economic crises in our country did their job: people seriously started to think about ways of saving and multiplying their income taking advantage of the market swings. Just remember 2014 crisis and 2016 Swiss franc meltdown — all these are great opportunities to earn money. Even the senior citizens understand that. In our newspaper, “Time of Finance” we tell several stories of successful “investor-grannies”. These people inspire a great respect. Their minds are at work, they are busy, they make money and set an excellent example for the others.
Where do you see Forex market in Russia in five years?
It’s a tough question. Our MPs are so unpredictable that I wouldn’t dare to make any long-term predictions. But nonetheless I expect that in five years the market will still be more or less the same. Sure, new services will emerge and trading equipment will upgrade. Considering licensing, countries will control their markets more thoroughly and set more complicated rules. It will require larger security deposits and authorized capital for the companies. This will provide security for traders.
What has changed in your company in the past decade?
Actually, we worked our way from one-office start-up in Saint Petersburg to international company represented in Asia, Africa, China, India, Europe. Our website is available in 12 languages and this number is constantly growing. The whole image of the company has changed, we gathered a great team, young and purposeful people. I consider it my greatest accomplishment as a manager. The company participates in major events in Forex industry in the world. Moreover, the company gave birth to a number of other projects, for example a broker software developer UpTrader.
Do you have plans to acquire Bank of Russia license in the nearest future?
Now we are in the process of receiving CySec license. I trust it will be ready by the start of the next year. Also, in March, 2016 we received Saint Petersburg government license for providing educational services, so all our educational projects are in the legal terrain. The next step we are considering is the possibility of getting Central Bank of Russia license.
With what figures have you finished your first decade? What changes are awaiting Grand Capital traders in the next few years?
The company showed substantial growth in trading volume, right now our volume is $4,7 bln. For example, in 2014 it reached $1,7 bln. The number of our foreign representatives increased, the new offices opened in India, Southern Africa. We tried for a long time to find an approach to China and now with the new regional development team it began to yield results. The company more and more shifts into technological direction. We are going to improve the execution, plan on adapting all our services for mobile trading, right now Binary Options app is under development. Also, we have plans for development of investment services and spreading financial literacy. Actually, a couple days ago, together with “Drofa” PR agency we published the first issue of “Time of Finance” newspaper, its goal is to tell about investments and financial products in layman’s language. I hope, we will continue to increase our rates of growth and aim at becoming a perfect company.
We are planning to keep improving the execution and adapt all company's services to work on mobile devices. As of the moment we are developing a Binary Options mobile trading app. We also have plans to keep improving our investment services and Forex education. I hope that we will keep accelerating our growth pace and aspire to become an ideal broker.