OANDA, the pioneering Canadian forex trading provider, has bought out Currensee Global Inc., one of the leading lights in the fast-emerging copy trading and social trading sphere.
Back In The Game
The acquisition marks OANDA’s re-entry into the social trading game, after discontinuing its proprietary fxUnity social trading network earlier this year. This project was launched in 2012 amid a great deal of enthusiasm, but it struggled to compete in a marketplace that, in spite of its relative youth, was already pretty crowded. At the time of the announcement, OANDA indicated that it was planning to pursue a strategy based on partnership in future:
Trevor Young, Director of Product Management, OANDA
“Although we have discontinued fxUnity, we remain actively engaged in the social forex space through partnerships (i.e. StockTwits). We see great potential in social but we believe this area is still evolving. Our plan is to leverage best-of-breed partners to complement our core technology for desktop and mobile.” Trevor Young, VP of Product Management, OANDA
It’s clear that the latest acquisition is the result of this strategic shift, one that has seen the firm team up with leading technical analysis firm Autochartist and the aforementioned StockTwits social trading network. As one of the market leaders in this highly competitive field, the purchase of Currensee represents a significant coup for the Canadian firm, giving it an instant, tangible foothold in the fast-growing social trading marketplace.
Currensee were one of the pioneers of copy trading, a spin-off of social trading networks that enables users to automatically mirror the trading activities of experienced forex traders with a proven track record of profitability. Being a component of a wider social trading network, copy trading also makes it possible to collaborate with other traders, sharing research data and insights.
The merger will provide mutual benefits for customers of both firms, with OANDA clients being able to leverage the knowledge of Currensee’s network of experienced traders, and Currensee users gaining access to OANDA’s trading technology.
“With the acquisition of Currensee’s award-winning copy trading platform, OANDA’s clients will benefit from the collective experience of Currensee’s extensive community of traders,” said K Duker, CEO, OANDA Corporation. “Like OANDA, Currensee has a strong business vision coupled with an expert engineering pedigree. We are committed to continue serving the needs of all Currensee customers, Trade Leaders, and partners and look forward to making OANDA’s competitive spreads and superior execution available to this new group of traders.”
The merger has also received an enthusiastic response from Currensee CEO Dave Lemont:
Currensee CEO Dave Lemont
“The Currensee team is excited to join forces with OANDA, a company that shares our commitment to transparency and customer success…Our clients and partners will continue to receive best-in-class service from Currensee, and can expect even more as we work closely with OANDA to deliver an even better Trade Leaders Investment Program around the world.”
OANDA – A Forex Innovator
OANDA Corporation has been one of the market leaders in online forex trading since the early days of the industry. Way back in 1996, the firm was the first to offer online access to live currency information, along with currency conversion tools, historical data, news, and analysis. To this day, OANDA Rate data are considered benchmark rates for global banks, auditing firms, and corporations.
In 2001, it revolutionised the online trading sphere with the launch of the fxTrade online forex trading platform, which was the first to offer immediate execution, instant settlement of trades, interest calculated by the second, and flexible trade sizes. It has since introduced several major innovations, being among the first to develop mobile trading apps with full desktop functionality, and also being the first to introduce fractional pips (pipettes) and live charts.
Perfect Partners?
In Currensee, OANDA appear to have found a company that shares their enthusiasm for transparency and innovation. It was founded in 2008, just as the global economy was in the midst of recession, and investors were running scared from traditional approaches to making money from the markets. Founders Asaf Yigal and Avi Leventhal identifyied social Forex trading as an area that had huge potential for growth as an alternative asset class, lending FX an accessibility and transparency that it had lacked previously.
While there were many companies going after the same market at the time, Currensee had an ace up their sleeve in the form of the Trade Leaders programme. This is an algorithm-based selection process intended to identify traders on their network that consistently turn profits by trading in a responsible manner. Investors can then view details of the various Trade Leaders that have met the standards of the selection process, and choose which ones they want to invest in, and how much of their portfolio they want to dedicate to each. The traders on the network are ranked on a leaderboard, based on their Trader Authority Index score, which takes into account risk and experience as well as profitability to discourage excessive risk-taking.
Investors can see every trade that is made by the Trade Leaders in their portfolio, providing a service similar to that of a mutual fund, but with far greater transparency. While Currensee has many competitors that offer a similar service, including eToro and ZuluTrade, they have remained one of the market leaders by establishing a reputation for the quality of traders in their network, and the rigour of the selection process. OANDA will be hoping that, with their combined resources, Currensee can build on these foundations and grow to dominate what is expected to be one of the biggest growth areas in online trading and investing.
