AI to Boost Online Trading 5% CAGR by 2028: Report

The global market of online trading platforms will reach US$12.16 billion by 2028, growing at a compound annual growth rate (CAGR) of 5.1% between 2021 and 2028. This growth will be boosted by increasing integration of artificial intelligence (AI) with electronic trading platform solutions.

These projections are based on a market research report by Fortune Business Insights, a market research solutions provider. The research mentions online trading providers such as Interactive Brokers, E-TRADE, Devexperts and Plus500, among others.

According to the report, the online trading platform market stood at US$8.28 billion in 2020, which was pushed by the COVID-19 pandemic. In addition, this figure increased to US$8.59 billion and is expected to hit over US$12 billion in 2028.

The report pointed out that the integration of AI-based chatbots services with electronic trading platform solutions is one of the new trends that will spur the growth of the market. In addition, the report notes that AI will revolutionize the future of online trading platforms through the integration of robo-advisors. Moreover, AI technology can help users to monitor millions of trade data pointers and run practices at an optimum price, the report says.

“Online trading platforms based on AI chatbots offer users custom-made information over one-to-one communication channels and assist in analyzing the key data points of traders and users. Also, chatbots can initiate and close online trading. Key players in the market are aiming to develop advanced online trading platforms based on AI chatbots,” the report explained.

However, the report believes that insufficient awareness about these solutions in developing countries can hamper the growth of the online trading platforms market in years to come.

North America to Maintain Leading Market Position

According to the Fortune Business Insights report, North America, which produced US$3.47 billion in revenue from online trading platforms in 2020, will remain the leading market in the coming years. This is because the region boasts of major online trading platform providers.

In Europe, the report expects the continent's market to undergo 'significant growth' over the years as private banking institutions in France, Germany, Spain, Italy and other European countries, continue to invest heavily in electronic trading platform solutions. On the contrary, the report foresees only 'stable growth' in South America and the Middle East and Africa. However, the report says companies in the regions “have started focusing on developing trading platform solutions for the diverse banking and financial industries.”

Furthermore, the report describes Asia Pacific as one of “the fastest-growing” regions in the world for the online trading platform market. This growth is being led by increasing investments in customized trading platform solutions in China, India, Japan, South Korea and other countries in the region.

Moreover, the report believes that the increasing adoption of cryptocurrency will boost market opportunities for all stakeholders across the regions.

APAC to Lead Algo Trading Market

Meanwhile, Finance Magnates recently reported that the value of the global algorithmic trading (or algo) market will reach $31.49 billion by 2028, growing at a CAGR of 12.7% between 2022-2028. This is even as reduced transaction costs and increased government regulations are expected to drive the growth of the market.

In addition, the Asia Pacific region is expected to be the most lucrative algo trading market within this stated period.

However, the report believes that insufficient awareness about these solutions in developing countries can hamper the growth of the online trading platforms market in years to come.