1.1 Introduction
A web-based trading system refers to an online platform that enables users to buy, sell, and manage financial assets, such as stocks, bonds, currencies, and derivatives, via the internet. These systems provide users with access to real-time market data, trading tools, and order execution functionalities, allowing for seamless and convenient trading experiences from any internet-connected device. Web-based trading systems allow users to access financial markets from anywhere with an internet connection, eliminating the need for physical presence at traditional trading floors or brokerage firms. This accessibility democratizes trading, empowering a broader spectrum of participants, including retail investors, to participate in the global marketplace. Moreover, these systems offer a wide range of features and functionalities, including real-time market data, customizable trading interfaces, advanced charting tools, and automated trading algorithms.
Furthermore, the impact of web-based trading systems extends beyond individual traders to influence market liquidity, price discovery, and market efficiency. The increased participation facilitated by these platforms contributes to deeper liquidity pools and tighter bid-ask spreads, fostering a more efficient and transparent market environment.
As a prelude to other parts of this study, this chapter will discuss the background upon which this study was initiated, the statement of problems that led to this study, the Aim and Objectives of the study. Others are Significance of the study, Scope of work, Limitation of the study and Definition of technical terms.
1.2 Background of Study
In today's digital age, the financial markets have witnessed a significant transformation with the advent of web-based trading systems. These systems, facilitated by advancements in technology and internet connectivity, allow investors to buy, sell, and manage financial assets online in real-time. Unlike traditional trading methods that often involve intermediaries and manual processes, web-based trading platforms offer users unprecedented convenience, accessibility, and speed in executing trades. The emergence of web-based trading systems has democratized access to financial markets, enabling individuals from diverse backgrounds to participate in trading activities previously reserved for institutional investors. Moreover, these platforms provide investors with a wealth of information, tools, and resources to make informed decisions, empowering them to take control of their investment portfolios and financial futures.
The internet has revolutionized the act of purchasing goods and services at the beckon of one’s impulse irrespective of the distance and location also the ease to supply and sell products; simply there is a financial exchange for either item(s) or services directly or indirectly. According to David (2011) Advertising Empire: Race and Visual Culture in Imperial Germany, Corporate bodies such as financial institutions, manufacturing industries and other like individuals now embraces the web platform for exercising exchange of mental resources, products and services for cashless-flow. The internet is the largest global set of computer communication network which is vast to accommodate a global economic trade of differs pattern and styles from selling heavy duties machinery to buying pen and cloths even rendering services as simulative ubiquitous learning, based on its universal access from all nations of the earth the internet serve as a medium of electronic transaction, boundless from any digital transaction except by restriction from merchant. The internet is actually a platform for advertising products and services and creating awareness of one’s intellectual property for financial fortunes.
Electronic trading is distinctively the most eminent function of the internet, the internet has had profound impact from inception in the lives of human in various facets as in informative approach, electronic trading is informative because it displays goods and services that are available for sales from various electronic stores and there are varieties of commodities that are available constantly, consistently and continuously online from different merchants, thereby providing billions of people entrance to trade at the click of the buttons, which unfold the wide range of transaction appreciation and dissatisfaction from different items purchased via customer response to encourage more buyers of such product or to dissuade one from purchasing such item, thereby positioning as a giant stack of financial transaction medium.
For electronic commerce to occur there need to be an access to the internet from any available devices at hand such as desktop PC, laptop, phone, tablets etc. To gain authorization by making placement of items and adding to cart and usage of smart card from various vendor or merchant id as in PayPal these devices are necessary in transaction process from access to the internet to placement of item then to payment of such item via smart card and shipping, furthermore to tracking of one’s item and finally receiving of one purchased item either from a courier services agent or at your door-step as the case maybe. The financial transaction can be done within few seconds, although when an item is outside a geographical sovereignty the item might take few days to arrive its destination depending on the weight of the item, which can be shipped via airplane or ship, finally checked by Custom of a different nation, else if it with a geographical location arrival might be at one doorstep same day it was purchased.
Federal University of Technology Owerri, will be engaging in electronic campus trading to ease the purchase of items and services within the campus communities to create avenue for awareness of personally items to be sold by staff and students and auctioning of university items such as vehicles, Air Conditions, Agro produces, Computers, printers, intellectual services, farm implement, etc. furthermore individuals within the campus community can also engage in the campus electronic trading, for a startup the platform will encourage online trading awareness where individual would be capable of advertising one’s items for sale for member of the campus communities, the mode of transaction would be based on items displayed from the university online server whereby potential buyers and sellers meet online later contact each other for final purchase within the campus community, i.e. if a student or staff need to sell for instance a shoe or a car such item can be advertise online through the campus trade platform and there will be people interested to purchase such items, because of the community numerical strength.
1.3 Statement of Problem
Investigation revealed that the difficulties arises from when members of the campus communities are in search for how to convey their items or possessions which is still relevant to another person’s on the campus but of less importance to them as owner, that is why student and even staff paste things for prospective buyers to see and patronize thereby littering the campus communities. Also, the proliferation of web-based trading systems has revolutionized the landscape of financial markets, offering investors unprecedented access to trading opportunities and resources. Despite advancements in cyber security measures, web-based trading systems remain susceptible to various security threats, including hacking, phishing attacks, and data breaches. The potential compromise of sensitive financial information poses a significant risk to investors and raises questions about the robustness of existing security protocols.
Additionally, the anonymity and ease of access afforded by web-based trading systems have facilitated the proliferation of market manipulation schemes and fraudulent activities. Malicious actors exploit vulnerabilities in the system to execute pump-and-dump schemes, insider trading, and other forms of market manipulation, undermining market integrity and investor confidence.
Furthermore, the reliability and performance of web-based trading platforms are paramount for ensuring seamless trading experiences and minimizing disruptions. However, technical glitches, system downtime, and latency issues are common operational risks associated with these platforms, potentially leading to financial losses and reputational damage for investors and platform providers alike. Addressing these challenges is essential for fostering trust, stability, and sustainability in the online trading environment and safeguarding the interests of investors and market stakeholders.
1.4 Aim and Objectives of the Study
The aim of the study is to design and implement a web based trading system. In achieving this aim, the following specific objectives were laid out as follows to develop an application software that will:
- Identify some of the key issues associated with trading between students of FUTO;
- Assess the security vulnerabilities inherent in web-based trading systems;
- Implement a prototype of online campus trading for FUTO; and
- Determine the best trading concept available for FUTO campus community.
1.5 Significance of Study
The significance of the proposed system will provide insights into operational risks and best practices for navigating web-based trading systems can empower market participants, including individual investors, traders, and financial institutions, to make informed decisions and mitigate potential risks. Also, the findings from studies on web-based trading systems can inform the development of regulatory policies and frameworks tailored to address emerging challenges and promote market integrity, transparency, and stability in the digital financial landscape.
This study will be helpful to other scholars who want to undertake a research on the same subject matter or take the scope of this research to another state. It will provide additional materials for researchers to make use of for reference purposes.
1.6 Scope of Study
The scope of the research is focused on the Design and Implementation of a Web Based Trading System.
1.7 Limitations of the Study
During the course of this study, many things militated against its completion, some of which are:
- Time Constraint: The time frame given to accomplish this project was very short due to school academic calendar and it was carried out under pressure which made the researcher not to implement some necessary features.
- Establishment Policies: Establishment policies posed a serious limitation as most staffs are not ready to release information needed for this research work. There were lots of information needed from the staffs of this institution to enhance the study which took them time to release or they did not release at all for security purposes, hence the scope was reduced.
- Financial Constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet).
1.8 Definition of Terms
Web-Based Trading System:
A web-based trading system refers to an online platform that enables users to buy, sell, and manage financial assets, such as stocks, bonds, currencies, and derivatives, via the internet. These systems provide users with access to real-time market data, trading tools, and order execution functionalities, allowing for seamless and convenient trading experiences from any internet-connected device.
Security Vulnerabilities:
Security vulnerabilities are weaknesses or flaws in the design, implementation, or operation of web-based trading systems that could be exploited by malicious actors to compromise the confidentiality, integrity, or availability of user data and assets. Common security vulnerabilities include software bugs, system misconfigurations, and inadequate authentication mechanisms.
Market Manipulation:
Market manipulation refers to intentional actions taken by traders or entities to artificially influence the supply or demand for financial instruments, thereby affecting their prices or market conditions for personal gain.
Regulatory Compliance:
Regulatory compliance encompasses adherence to laws, regulations, and industry standards governing the operation and conduct of web-based trading systems. This includes compliance with financial regulations related to investor protection, anti-money laundering (AML), know-your-customer (KYC) requirements, data privacy, and cyber security.
Operational Risks:
Operational risks are potential losses or disruptions arising from deficiencies or failures in the internal processes, systems, or human resources of web-based trading systems. These risks include technical glitches, system outages, capacity constraints, and errors in order execution, which can lead to financial losses, reputational damage, and legal liabilities.
