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Stockino – financial information system for securities traders and financial companies

The financial sector is one of the state-regulated industries in Slovakia and elsewhere in the EU. Companies that trade on behalf of their clients or manage their assets must generally be licensed by the National Bank of Slovakia (NBS) and meet strict regulatory criteria. And not only to our national regulator (the NBS), but also to the European Central Bank, which regulates the market at the European level.

Establishing a legal entity – a joint stock company, a securities trader is administratively demanding and brings several legislative obligations. Among other things, it also places demands on the software equipment of the company applying for a licence.

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Software for securities dealers or other financial companies subject to regulation must be inspected or audited by the National Bank of Slovakia before a licence is granted. The inspection validates the fulfilment of the software’s mandatory requirements. It also verifies the ability of specific staff to work with the software to fulfil their legislative obligations.

Stockino is a boxed solution, a software product aimed specifically at companies in this regulated industry, which meets all the demanding requirements of the National Bank. At the same time, it helps to automate and digitalize the internal processes of financial companies.

How does Stockino work?

Financial information system Stockino is an open platform for stock traders. It works in a web browser environment in a cloud or even an on-premise environment. The choice of the solution itself – cloud vs. on-premise – reflects the security requirements. All personal data is stored encrypted in the database, and all communication flows over a secure SSL protocol. But some companies choose an on-premise solution for the high level of security. The software runs on servers exclusively within the internal network, without an internet connection.

What does an open platform mean? Stockino comes with a myriad of modules at its core. They cover all the daily routine activities of financial companies and help cover the processes these companies need for their “seamless” operation. However, when creating any software, you need to think about the nuances that set each company apart. Stockino responds to these differences and offers a wide range of possibilities for “customization” – tailoring the software and so-called on-demand development. Thus, Stockino’s licensed customers can count on the software to respond to changing requirements. Either “automatically” – for example, with a change in legislation or planned updates according to the development roadmap, or also “on-demand”, i.e., according to the specific requirements of a particular customer.

Stockino is a so-called closing system, i.e., the transaction data accumulated in the financial information system is consolidated to form daily closing totals. This makes the system fast, even when used for many years with millions of database rows. Reporting and data handling generally use daily, consolidated data, so there is no need to search the entire complex transaction database. 

The entire comprehensive solution also includes functionalities focused on the digital onboarding of clients and the creation of a client zone – an interface for investors, providing a real-time view of developing the investment portfolio.

What modules does Stockino contain?

The supporting element and unifying entity of the whole financial information system is the Client and the Security, or Equity. Almost all other modules of the whole system are tied with these. Within the system, we record all the legally obligatory information about the clients and other necessary data and entities. This enables the management of the necessary processes. These are, for example, the following modules.

Financial (cash) accounts

Virtual financial accounts used for internal recording of money.

Property accounts

Virtual asset accounts recording the client’s assets.

Investment strategies

Including the client in the investment strategy automates the purchasing processes.

Contracts

Recording of contracts and other client documentation.

Transactions

Detailed records of all transactions carried out on financial accounts.

Instructions

Recording of orders to buy or sell.

Shops

Database of executed instructions.

Securities

Asset overview and list of securities held by the client.

Stockino comes with a myriad of modules in its base. They cover all the daily routine activities of financial companies and help cover the processes these companies need to have for their “seamless” operation.

Investment strategies or portfolios

One of Stockino’s core modules is Investment Strategies. These are used to categorize clients while automating the bulk management of investment portfolios. An Investment Strategy is a fully configurable entity containing selected assets and possibly a benchmark (e.g., S&P 500) against which the strategy’s performance is compared. With an active module for automatic trade calculation, Stockino also takes care of automating buying orders for several assets that correspond to the percentage ratios within a strategy while considering the state of the client’s financial accounts. Hence the need to work with fractional stocks, i.e., fractions – yes, Stockino is geared to the possibility of fractional trading.

Money, instructions, confirmations

Money, Orders and Confirmations are important and interconnected modules for the placement, subsequent confirmation and entry of orders into the market. In securities trading firms, responsibilities are generally split between the Front Office and Back Office. This also reflects the setup of user roles and responsibilities within Stockino. Entering buy or sell orders into the system is the user’s responsibility with the Front Office role. The actual confirmation and settlement of orders is usually the responsibility of another administrator – so, four eyes control is maintained.

Order entry, validation, confirmation, market entry and settlement are all very complex screens with many validations and automated checks tied to them. Automated validation aims to prevent potential errors while generating such high-quality data into the financial information system that subsequent reporting to regulators is seamless.

The above-mentioned modules also include the settlement of dividends, possible stock-splits, and Fee Structure management and accounting. The fee structure is fully configurable, adjustable according to the needs of the specific customer.

In securities trading companies, responsibilities are usually divided between Front Office and Back Office, reflecting the setup of user roles and responsibilities within Stockino.

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Reporting

Stockino includes a very comprehensive reporting module that allows you to look at company-wide data from various perspectives. Besides the legally required reports – e.g., reporting for the National Bank of Slovakia or ESMA reporting, dozens of other internal reports are available. These are used both for clients (e.g., fund valuation, account statements) and internal needs (e.g., reports on deposits, trades, orders). Many reports are automated, and the outputs are sent at set intervals to their expected clients or system administrators. Stockino also includes several internal “triggers” that generate a report or at least a notification. Part of this is the so-called AML – Anti Money Laundering report. The reports are often programmed to a specific customer, as they can develop their own view of the data that the company collects.

Reports to regulators – NBS, ESMA are generated automatically. At the same time, the entire system is designed, so the data collected and recorded in Stockino is sufficiently comprehensive for the generation of reports required by the legislation.

In addition to the legally required reports – e.g., reporting for the National Bank of Slovakia or ESMA reporting, dozens of other internal reports are available. 

P&L or Profit & Losses

P&L is a standalone Stockino plugin, a very comprehensive module for tracking the performance of individual portfolios or entire investment strategies. It contains a complex mathematical model to calculate portfolio value.

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What is the pricing policy?

Stockino is a software with a simple EULA licensing pricing policy, where the base price consists of two components:

  • software installation fee, including some work-days required to customize the system or migrate data from other software
  • a monthly licence fee, considering the number and nature of the modules used.

Due to the regulatory requirements of the NBS, each securities traders license holder must also have a valid SLA (Service Level Agreement ) contract, by which the software operator guarantees the client response times and service conditions. This agreement is a priced component of the monthly license fee and does not increase the financial cost of operation.

Stockino is also designed for start-up financial companies that must have a Future Software Agreement in place before applying for a license – we take this into account. We are happy to help with the necessary documentation.

financial information system

Digital onboarding and client zones

Stockino also includes outputs for clients of financial companies and tools for their digital onboarding, linked directly to the core financial information system. Digital onboarding is a topic that the pandemic situation has accelerated. The pressure to digitalize companies’ processes has increased precisely because of the limited opportunities for face-to-face meetings. Stockino’s digital onboarding is a legislated 100% compliant process. It enables a person to become a financial institution client without the need to physically visit a branch. The solution can include facial biometrics, i.e. verifying the client’s identity and digital signing of contractual documentation via a tablet or smartphone. As part of onboarding, the client goes through the steps required by legislation, such as a mandatory investment questionnaire and a commercial questionnaire used to discover the client’s investment intentions or preferences.

Stockino’s digital onboarding is a legislated 100% compliant process through which a person becomes a client of a financial institution without the need to physically visit a branch.

financial information system

The client zone is the next logical step of the “onboarded” client, within which the user is given access to their data. In real time, they can view their financial or asset account balances, enter instructions to buy or sell assets, and deposit or withdraw funds. The client also has access to contractual documentation and reports in the message centre in the client area, which can be generated by securities traders on request. The client zone is delivered as a white-label solution. It is fully customisable to the visual identity of the specific trader, to consistently complement all of the company’s visual outputs.

Besides clients’ access to their data, the client zone also allows brokers/dealers access to their clients’ data. This makes their work very transparent and allows them to maintain control over the status of the client portals. This access for intermediaries to the client zone can be integrated into intermediaries’ existing CRM solutions using APIs. This allows them to service clients under one roof without having to leave their CRM application.

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Conclusion

Stockino is a modern financial information system with links to financial market data, with a modular architecture. It enables out-of-the-box operation for newly established financial companies so that it can shape companies’ processes. Thanks to its open architecture, Stockino’s processes can also be adapted to the specific requirements of companies established on the market for a long time.

The collaboration of several securities traders created Stockino. Its goal is to build a long-term market standard and become a leader in software for financial institutions, wealth management companies, securities traders, asset managers or other institutions managing their clients’ assets.

Arrange a consultation and comprehensive presentation of Stockino’s capabilities and consider it an alternative to existing – or too expensive – software available on the market.  

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