From Grand Theft Auto to Wall St: Trading apps woo gamers


  • TECH
  • Tuesday, 17 Feb 2015

TURNING TRADING INTO GAMING: Games that prepare you for trading in the financial markets, without the financial jargon.

LONDON: Twenty-something consumers raised on video games such as Grand Theft Auto and Angry Birds are being wooed by financial trading apps, keen to build bridges with a post-crisis generation that is uninterested in financial services or plain mistrustful.

Bright colours, cartoon graphics and the ability to trade risk-free with virtual credits are features of apps such as BUX and Kapitall, which eschew financial lingo and complex charts in favour of competitive head-to-head battles and motivational messages like "OMG!" after placing a trade.

While financial trading is a niche slice of the US$15bil (RM53.7bil) mobile gaming industry, dominated by brands such as King Digital Entertainment's Candy Crush, some two-thirds of British retail traders already use their smartphone or computer to buy or sell and app makers are sensing an opportunity.

"Developers are realising that games are played by all kinds of people with different desires and motivations, and the same kind of person who is hooked on a computer video game may seek a similar thrill from the stock market," said Kam Star, founder and managing director at games development studio PlayGen.

Nick Bortot, a former executive at online broker Binckbank, set up BUX (getbux.com) last year in Amsterdam and London. BUX's launch followed that of similar firms Kapitall and invstr.

Both BUX and Kapitall offer players the chance to play games such as challenging each other on how stocks might perform, but they also offer players the opportunity to go from playing for points to betting actual money.

"I got hooked on BUX instantly, playing for fun, and trying to understand how shares and markets work. Since mid-December, I have been trading with real money," said Nathaniel Brooks, a 28-year-old manager and Playstation aficionado.

Virtual points

All three companies hope their bright graphics and games can lure a younger audience to the sometimes arcane world of finance, the least trusted industry in the world according to a 2014 survey by communications company Edelman. By contrast, technology is the most trusted.

For now, invstr is only focusing on games that allow people to predict where markets may go for virtual points, and on building up a community of users, but the company may also let people bet real money at a later stage.

Bortot said only 5% of BUX users converted from virtual play to real money, but there were still ways for BUX to make money from mere players.

He said the company would charge small add-on fees of around 0.89 euro (RM3.63) to top up a "funBUX" virtual account, or to follow top traders on the Internet.

For those converting from play money to real, BUX would then charge small commissions of around 0.40 euro (RM1.62) per transaction, far cheaper than online brokerage costs at bigger, more mainstream firms.

Some were sceptical over the prospects of such firms, while others expressed concerns over the possible trivialisation of trading on financial markets.

"We are aware that the two markets are converging, but we are keeping our financial trading and gambling parts quite separate," said Shai Heffetz, managing director at InterTrader, which is owned by gambling company BWin.Party.

Nevertheless, technology analyst Susan Anthony at brokerage Mirabaud Securities said the business could be worth exploring. "Whether or not these things become killer apps is hard to predict, but I can certainly see how they might become quite addictive for some." — Reuters
Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 1
Cxense type: free
User access status: 3
   

Next In Tech News

Coinbase listing marks latest step in crypto's march to the mainstream
Buying diamonds in lockdown? WhatsApp can be your best friend
Digi offers 100GB high speed data pass at RM7, available from 3am to 7am
Maybank warns of new fake banking website created to steal customer details
Microsoft defends against new threat to Exchange
Jack Ma’s double-whammy marks the end of China tech’s golden age
15 years of Spotify: How the streaming giant has changed and reinvented the music industry
Facebook’s new target in the misinformation war: climate lies
Smart-home products enjoy surging sales in Europe
Facebook oversight panel will now review takedown requests

Stories You'll Enjoy


Vouchers