lemon.markets Use Cases


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Published by Marius Sprenger on June 25, 2021
Insights


Over the past few months, we at lemon.markets have been working hard on our relaunch. A large part of that was actively communicating with our users. In fact, we surveyed over 2,000 developers that were part of our first prototype and asked them about their projects. We got a ton of interesting insights about real-world projects that are currently (planned to be) brought to life with lemon.markets and that we would like to share with you. Happy reading and we are looking forward to a lot more ideas and projects in the future 🚀

Building a brokerage infrastructure company such as lemon.markets (or any kind of infrastructure or API-first company really) requires a lot of imagination. Besides the rather obvious realisation that building any company from scratch is an adventure that can only succeed if you have people on board that think about problems in a holistic, but creative way, there is also a more specific reason in our case:

We are not building a product that delivers the same experience for each of our customers. Instead, we develop a system that allows our users to create their own experience. So, the process of designing features for our product is rather abstract, because the main questions we need to ask ourselves always go into the direction of “how does feature A or B need to look like so that in the next step the user can build product X or Y?”.

We think that this level of abstract thinking about our user’s needs is what makes lemon.markets so exciting, but also challenging at the same time.

But life would be boring if you weren’t a bit overwhelmed at times, right?

So, to make sure that we were not developing features that go into the wrong direction, a few weeks ago we simply asked the ~2,000 users that were part of our first prototype what they are planning on building with us once we are live. We aggregated the insights in this blog post for two reasons:

  1. to show everyone how other users are thinking about lemon.markets
  2. to inspire potential users that might still be a bit unsure about what they can build with us.

Ready for a few cool lemon.markets Use Cases? 🤩

Indicator Trading

Through our user survey, we noticed that there are many users that want to keep an overview of all placed orders and still have a “manual review component” in there. We summarise these use cases under the term “Indicator Trading”. The name already pretty much gives away what we understand by this, but let us clarify the concept nevertheless. As you can conveniently get historical as well as real-time market data through lemon.markets, it is comparably easy to develop a script that analyses these price developments. Let’s say a stock crosses a certain threshold (e.g. its current value is higher than its two-weeks average), then this would be an indicator for you to buy or sell it. Indicator Trading with lemon.markets could work in the following way:

  • you develop your own script that notifies you at some point in time. This can be (as mentioned above) a specific price development, but also e.g. when a specific person tweets something, a political event occurs somewhere in the world, or a newspaper publishes some breaking news. All of these things could trigger some kind of notification→ send you some indicator that it might be a good idea to buy or sell a specific stock.
  • You could then manually review this notification and decide on your own whether you want to place the order. This gives you more control about your trading, especially when you’re dealing with high-risk areas, where it makes sense to manually review the things you are doing at the stock market, while there are certainly use cases where it makes more sense to completely automate your trading (we will come to that in a second).

In general, Indicator Trading is an approach that is highly popular among our prototype users, with more than 35% stating that they would be interested in developing a project that indicates them when to buy or sell. Internally, we also think about Indicator Trading as a first step towards full automation. Think of a fully automated trading strategy as your first swimming session of the season. You probably want to dip your toes into the water first, see if everything is fine. Once you notice that the water is actually quite pleasant (your trading strategy is working), you get more confident and swim out into the ocean (remove the manual review component and fully automate your trading strategy). Sorry for this cheesy analogy, summers in Berlin are quite hot, but you get the point :D

Obviously, we are super excited to see some of their strategies in action once we go live.

Automated Trading Strategy

The use case that was mentioned by many of our users as potentially interesting, 52% to be exact, was the desire to develop and run an automated trading strategy. For those that may not be totally sure what that means exactly, let’s dive a little deeper into that. Initially, lemon.markets was planned to be a simple API that allows its user to automate their trading. What current trading applications or traditional banks offer is that you can buy and sell single stocks manually.

However, in today’s fast-moving markets and with time being a limited resource for most of us, we (and apparently our users as well) believe that there is a better approach: develop a trading script that automatically places orders based on predefined buy and sell rules. On the one hand, this saves a lot of time, as you do not need to perform your analysis manually anymore, while on the other hand it removes the (often times hindering) emotional component from the process. What exactly stands behind the automation, is thereby completely up to your imagination. Many users reported that they plan on developing a machine-learning based trading strategy that analyses historical market data, compares it with current price developments and makes decisions based on that comparison. Others follow a less complex approach and simply want to automate and optimise their savings plan by not buying at a predefined date and time, but instead at the best point in time during the day. Others want to adapt a strategy they successfully implemented in a crypto context and now apply it to the stock market.

As you can see, there are many approaches and logics behind an automated trading strategy. The only relevant point is that you automate your previously manually executed analysis within a script, so that you can relax and all your investment decisions are made automatically. While the idea behind lemon.markets grew and developed over time, the use case of an automated trading strategy is still one of the most popular ones for our users.

Your own Trading Application

As we outlined above, lemon.markets over time developed away from a simple interface to automate your trading strategy to an infrastructure that allows you to build your own brokerage experience at the stock market. Therefore, it is important for us to also emphasise the use cases that have nothing to do with automated trading, especially because our prototype users also frequently mentioned that they plan on building such projects. We believe that there is still a lot of work to be done in the brokerage market. A lot of legacy technology preventing real innovation. And a lot of users that are not satisfied with the current services. And while the “frontend-first” wave brought some change and convenience to the market in recent years, with access to the stock market simplified and made cheaper through e.g. mobile applications, we noticed that this is still not sufficient for many people.

We believe in customisation. And we will therefore always strive to provide tools and services that allow just that. We want to outline a few community projects mentioned in our survey that follow this customisation approach:

  • One user set up a web application for him:her and his:her friends that allows everybody to conveniently monitor selected stocks and manage their portfolio. Other users also set up web or mobile apps, with which specific stocks and their price developments can be monitored and their own portfolio managed.

I've setup a web application (currently only available to friends who invest in stocks) that allows them to keep watchlists and to analyse their portfolio. For my next step I want to include custom alerts for their trading decisions, for which I need reliable intraday pricing information.

Survey Response by two of our users
  • Other users are interested in building their own “stock market alert app”, i.e. analysing selected stocks that are displayed within the app, and then sending push notifications when relevant changes occur.

I would like to track my stocks (se, de, no, us markets), send my self notifications, create a dashboard (web + app) and potentially a small bot private fincee tool checking my own depot and general stock market. At the moment I do this by "schreen-scraping" a german finance website which is much work and too much changings.

Survey Responses by two of our users
  • Some users want to go one step further and build a complete trading platform that others can use.

Implement a quantitative trading platform which leverages machine learning techniques to place trades automatically. Plus there would be a wonderful web app to visualize everything :)

Survey Response by one of our users

Market Data Visualisation

Initially launched as a “side feature”, we quickly noticed that reliable and continuously updated market data is a powerful thing that users are craving for. We adapted quickly and made it a clear priority for our relaunch. The feedback by our prototype users on their planned projects confirmed that choice. A large majority of automated strategies is planned to be based on quantitative analysis of market data that triggers a buy or sell decision. However, there are also many many projects that require reliable market data in a different context. We want to summarise them under the term “Market Data Visualisation”. According to our survey, many users are interested in visualising price developments of their favourite stocks. Either because many investment decisions are made from visual inspection, to recognise trends by comparing different stocks, or just for fun. Receiving market data through our REST-API is convenient and easy to handle. No more annoying scraping of trading websites, no more expensive purchases of data in the wrong format. Using the lemon.markets API, you cannot only retrieve the data with one simple request, but also easily continue working with it in your project.

We hope we did not overwhelm with the things you can do with us 😅. It is a lot to take in, and the possibilities seem almost endless, which makes lemon.markets such an exciting endeavour for us, and we’d be really excited if you decided to join us on our journey towards a brokerage infrastructure for the 21st century.

Did you miss a use case in this blog post, or do you have a question or comment? Leave us a message under this post or drop us an email at [email protected].

lemon.markets is currently in closed beta, so make sure to join our waitlist and tell us a little bit about what you are planning on building with us, so we can onboard you asap!

See you soon,

your lemoneers 🍋

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Find more resources to get started easily

Check out our documentation to find out more about our API structure, different endpoints and specific use cases.

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