The pandemic fueled a rise in stock market engagement, with higher levels of account openings and heavier equity and options volumes.
As the world returns to normal and market participants look for more efficient ways to build wealth for the long-term, new finance apps are popping up with supposed solutions.
One such app is offered by Streetbeat, a StartX accelerator graduate that just closed on a $10-million seed round led by TTV Capital, with additional backing from investors including Seraph Group and AAF Management.
In learning more about how participants can more methodically position themselves for volatile markets, Streetbeat’s founder and CEO Damián Scavo spoke with Benzinga.
The Context: Streetbeat is a natural evolution of trading applications, Scavo says.
Investors have realized that the system, though not explicitly, is rigged against them. Brokers make money regardless of trade outcome, and many professionals trade algorithmically.
“Manual trading is something that professionals stopped using in the ‘90s,” he said, noting that on the rare occasion institutions may place manual orders.
Founded in 2020, Palo Alto-based Streetbeat delivers a holistic online trading and robo-advising solution that executes trades on advanced data and strategies built by vetted professionals.
The multi-strategy platform, with coverage across crypto, ETFs and more, provides individual persons and business entities across nearly 50 countries the opportunity to diversify their exposure and position themselves best for heightened market volatility.
“You can sign up not only as a person. You can sign up as a company and you can manage their liquidity there,” Scavo said.
More On Offer: There are a few key problems Streetbeat is looking to solve.
The first is concerned with the way retail trades. Mainly, there are a lot of costs people fail to see.
“For example, on Robinhood, you pay the bid-ask spread every time you buy with a default market order,” Scavo said. “The bid-ask spreads can be gigantic, reaching nearly 4% on some very small caps.”
The second problem? Direction. Investors seldom have the proper information to make educated directional investment decisions.
The last two? Tax optimization and exposure to alternative assets and yield farming.
In solving the first, Streetbeat, by default, will send customer orders so-called limits in the middle of the bid-ask spread with accompanying stop and take-profit orders.
In solving the second problem, through the algorithmic application of the top-performing strategies of on-boarded hedge funds and professional traders, Streetbeat gives traders a way to sidestep volatility and position for higher-odds growth.
Impact, Vision: When a client joins the platform, they can trade in stock and crypto, or follow top trading strategies. This takes uncertainty and emotion out of the equation, Scavo said.
“The main strategies utilize algorithmic trading,” he said in a discussion on the performance of nearly 40,000 Streetbeat accounts. “They buy and sell several dozens of stocks at the same time. We’ve seen customers trading 40 to 50 times more than normal.”
The onboarded pro traders and funds, which users can pick and choose from, charge management and performance fees that are passed on to users but Scavo noted that, at the outset, no management fees would be charged. Additionally, the firm does offer margin and there are intentions to add educational videos.
“Our goal is to democratize value trading and centralized financing,” Scavo said. “We’re feedback-driven.”
Bonus: In light of the company’s growth push, users qualify to get up to $1,000 when they open accounts and transfer $100,000.00 in cash or assets.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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