On June 17th, Saxo Capital Markets HK Limited, a subsidiary of Saxo Bank (Shengbao Bank), which has the world's largest integrated trading platform, signed a memorandum of understanding (also known as a "cooperation framework agreement") with Hong Kong-listed company IGC (00033), with plans to promote bilateral mutually beneficial cooperation in trading technology licensing and asset management.

An institutional source in Hong Kong told Zhitong Finance APP that the cooperation between the two sides means that Saxo will introduce IGC's algorithmic trading technology, which has been continuously iterated and developed, into its well-known forex trading system, consolidating its already high industry competitiveness and industry leader position. At the same time, it is also expected to bring considerable revenue contributions to IGC's trading technology licensing business and contribute to its performance leap.

Established in Denmark in 1992, Saxo has its headquarters in Copenhagen and has expanded its business to more than 170 countries/regions over 30 years. It is one of the few comprehensive trading companies with a long history, huge scale, and reliability in the industry. As a leading financial technology company and one of the largest online traders in the market, it is also one of the first banks to sign the Global Foreign Exchange Industry Code of Conduct, aiming to improve industry standards and promote best practices among market participants.

According to official website information, Saxo manages client assets of over $100 billion and handles daily trading volumes of over $20 billion, covering trading of forex, CFDs, equities, ETFs, futures, options, and bonds. In terms of qualifications, Saxo holds more than 10 financial regulatory licenses, including those from Hong Kong, Singapore, Denmark, the UK, and Australia, and is licensed as a bank in Denmark, Switzerland, and the Netherlands.

The signing of this cooperation intention has aroused the market's curiosity. How can Saxo, which already has a leading position in the forex trading platform, achieve equal and mutually beneficial cooperation with IGC?

First of all, on the technology side, Saxo started independently developing trading platforms in 1998, opening a new era of online forex trading. So far, it has provided multi-market commodity investment services that most traders cannot achieve, and continues to keep at the industry forefront. As one of the first financial institutions to develop online trading platforms, Saxo is known as a fintech company even before the word fintech appeared.

Checking IGC's announcements and official website information shows that the company has announced its transformation since 2023 and continues to deepen the research and development of AI trading technology ("algorithms") that has been accumulated to a certain extent, while also improving its commercialization and business levels. It is reported that its algorithmic trading technology is already accumulating customers and performance in the forex trading field, and is believed to be one of the reasons that impressed Saxo to cooperate.

To further enhance its research and technology capabilities, in January 2024, IGC successfully acquired all the shares of Deep Neural Computing Company Limited ("DNCC"), further enhancing its strength in the field of algorithmic trading technology. According to the proposed acquisition announcement, DNCC is a company focusing on the research and development of deep neural networks, artificial intelligence, distributed computing, and quantitative trading algorithms. In the 15 months before the acquisition, the company's net income exceeded HKD 30 million. With the settlement date of IGC's annual report on June 30th coming soon, the market is beginning to look forward to how much profit DNCC can contribute to IGC after the acquisition and how much anticipation it can bring to future business partners that can be introduced by IGC.

Finally, returning to the idea that technology drives productivity, according to the official website introduction, IGC's algorithmic researches are multiple trading algorithms based on machine learning and deep learning. These algorithms can analyze market data in real-time, capture trading opportunities and make rapid and accurate trading decisions. In addition, the company provides personalized algorithmic services for different investment needs, helping customers realize asset appreciation. Therefore, as forex trading experts, Saxo and IGC, IGC can bring technology empowerment to Saxo, which is undoubtedly true, or as announced, Saxo can bring IGC the world's magnitude of customers, billion-dollar assets, and initial launch phase revenue for either deploying its trading technology in self- trading or distributing or leasing IGC's trading technology via its well-known platform, with the industry's average licensing fee rate of 3-4%.

IGC's transformation is about to face its first performance test, and the market has every reason to believe that it is worth looking forward to.