SIMON BROWN: I’m speaking now with Rob van Eyden. He is the CEO of Scope Markets South Africa, also author of the book Badass Trader: How to Trade Your Way to Riches. Rob, appreciate the early morning.
Another advantage with indices is the diversification play, because it allows traders to get exposure to a broader market segment then gravitating to one individual asset. And this diversification can reduce risk and offer a more balanced investment approach for retail clients. And I think things have also changed quite a lot. In the past it was very difficult to trade indices, there weren’t many; and you have to trade them in lots now. There are smaller lot sizes as well. So accessibility has changed quite a lot across the globe.
ROB VAN EYDEN: Prop trading – I’ll give you the old-school definition. Prop trading is where you use someone else’s capital to trade. In the past it was basically you had a lot of people joining a prop house and you had to pay for your own costs. So you had to pay basically your seed cost, and you were given opportunity to trade the house or the business’s capital. That has also evolved and moved electronically, where you need to do a challenge.