How to Build an Investment App or Platform
How to Build an Investment App or Platform
According to a Bankrate survey, 63% of smartphone users in the United States have at least one financial application, 17% of which are investment. Among young people aged 18 to 34 years, the level of admission of investment applications is almost doubled - 31%. This data suggests two things:
Below you will find a detailed guide to creating investment applications with examples of successful cases and illustrations of the most important moments.
There are many options where and how to invest. These can be ordinary investments in currency, gold, or real estate, or investments in venture funds, blockchain startups, or socially significant projects. And before you start developing an investment application, you should decide on its niche and positioning.
Now the following markets are considered promising:
In addition to choosing an interesting niche, you can stand out among competitors in another way. For example, you can bet on a specific target audience: youth, retirees, bankers, traders, foreigners, socially responsible citizens or residents of New York. If you are able to create unique value for any segregated group, then position your application as specially created for them.
Here are some tips to help you get right:
Thus, the Betterment application allows users to synchronize their personal accounts with third-party investment accounts and communicate with a personal advisor. The M1 Finance app bets on "smart design", allowing you to better understand your investment portfolio.
Automated financial consultant is the main trend of the modern financial market: according to surveys, 16% of Americans are planning to use applications with this function. These applications give investment advice, assess risks, trade on the currency and stock markets and are constantly engaged in self-development in all these areas. Most of these solutions are based on deep neural networks that use big data to analyze the market and find patterns.
What you need to implement in the robot consultant:
Practice shows that these measures are sufficient to protect against most hacker attacks. The only exceptions are phishing attacks that are conducted outside the investment application ecosystem.
When creating an investment application, do not forget to implement push notifications, custom reminders and real-time alerts in it. With their help, the system can notify customers about interesting offers, promotions, discounts, current account status, the rising or falling value of a certain asset, and also notify them of unusual activity (which may indicate an account has been hacked).
Thus, Coinbase and Ally Invest have implemented the ability to notify on real-time rates with the ability to set the level of the asset value, after which a message will pop up on the smartphone screen. In TD Ameritrade Mobile push notifications alert you when your intended investment goal has been achieved, and Vault, using messages, asks users for permission to transfer a predetermined percentage of funds to an IRA personal account.
Fast and qualified support is the key to success and high ratings of any application, so think ahead about what it will be in your case. And do not forget to indicate the appropriate contacts wherever the user may have thought to contact the consultant.
There are several ways to implement support service:
If you want your investment application to be popular in the App Store and Google Play, do not save on development and try to immediately implement all the necessary functions. This is the only way you can compete with Betterment, M1 Finance or Betterment.
Most investment applications rely on transaction fees for depositing / withdrawing funds and / or buying / selling assets, so that the application itself is essentially free. This monetization model is used by M1 Finance, Robinhood, Ellevest and Coinbase. Other services use a subscription, for example, Ally Invest and Blooom.
A more interesting monetization model in Personal Capital, Acorns and Wealthfront. They charge a fee for managing assets in the form of a percentage of transactions made with their help, or in the form of a separate periodic connection fee for this service. For example, Acorns takes 1% of all transactions conducted through their automated investment system.
As for additional services, these can be consultations with experienced managers and traders, audit of the investment portfolio, access to information (studies, statistics, markers, data on investment portfolios of well-known investors, etc.) and issuing various documents.
Which model you should use depends on what services you will offer. For example, if you offer trading services or an investment bot is integrated into your application, then you need to take a percentage from the transactions. If you plan to use experts or offer connections to various external investment funds, you need to enter a subscription. And, of course, in all cases, you need to earn on advertising.