CEO Insights Magazine

In the dynamic Malaysian business world, CEOs significantly influence the sector's direction. The most successful CEOs are the ones who have a long-term vision and are committed to creating lasting value. These leaders have all the right executive skills, financial acumen, strategic and operational management, and system thinking. But the best CEOs take timeless actions and make informed decisions, despite the circumstances.

One such dynamic and visionary leader in Malaysia is Alex Koh Hang Wee, Owner of ALGOPEDIA. Alex Koh Hang Wee is a seasoned professional specializing in investment management, financial analysis, and strategic planning, with a proven track record in driving business growth and optimizing investment portfolios. In one of the reputable Champion Trader Competition, Alex achieved a result of 90.5 percent return in two month’s time.

In this interview, we spoke to Alex Koh Hang Wee, a Malaysian-born techpreneur who embarked on his entrepreneurship journey in 2003 and founded ALGOPEDIA in 2021, a licensed proprietary trading firm, which provides all the tools, guidance, and support to traders who need to succeed in Futures Trading. 

Please walk us through your career journey & the founding story of ALGOPEDIA?

I started as a non-professional floor trader while still in university. Eventually, I was involved with a 'bucket shop,' which in our financial industry refers to an illegal trading operation. This bucket shop operated without exchange registration and surveillance, setting prices with slippages and zero transparency. In the 1997 Asia Crisis, during Malaysia's capital control period, many such shops exploited the situation.

After graduating, I didn't immediately join the industry due to financial needs and started working at Magnum Corporation, a listed company in Malaysia's gaming industry. Later, I moved to Indonesia, spending around nine months in Bali and six months in Jakarta, setting up gaming teams for Magnum Corporation. 

Upon completing this job, I returned to Malaysia in 2003 to become a full-time professional trader. Over time, I transitioned into the brokerage business with RHB Investment Bank Malaysia. Prior to RHB, I worked with several companies, including the earliest futures derivatives company in Malaysia such as Okachi. 

At RHB, we assisted clients with futures trading, which is my sole focus; I'm not involved in equities as I fully focus on derivatives trading especially foreign products in SGX, HKEX, ICE and CME. In 2017, I began developing an algorithmic trading system, which led to the creation of the very first local full algorithm system in Malaysia. We pioneered the design of an algorithmic trading system in Malaysia, which we used to guide traders on how to trade and market-make various products on the exchange. 

We are the first local company in Malaysia to achieve this through market making Bursa Malaysia derivatives using our in house developed algorithm. We formalized our in-house systems, including our database and trading methodology, to train our traders. We train our traders to form a professional trading group.
 

My leadership approach can be viewed from two perspectives: my brokerage business and my inhouse traders.

In the brokerage business, we strive to offer unique products to our clients. We were the first in Malaysia to introduce innovative products like live cattle futures. We actively promote Hong Kong exchange products and deal extensively with treasury notes and interest rate futures via US CME. My leadership focuses on helping clients diversify and gain exposure to products unavailable locally, by leveraging our strong relationships with exchanges worldwide.

For my in-house traders at ALGOPEDIA, I emphasize a data-driven approach. I prioritize analyzing data over following news or other external factors. We have established a data-driven methodology and standard operating procedures (SOP) for our traders, creating a systematic and disciplined trading environment. Take optimization as example, each product will go through a minimum of 8 million looping combination for each parameter we use during testing process. This shows that we are fully committed with the whole data-driven approach. This approach helps reduce the psychological pressure on traders, making the process more mechanical and less emotional in trading.

Our environment allows individuals without traditional academic qualifications to excel. For example, we have traders who were previously working in unrelated fields, like selling iPhones, who have successfully transitioned to trading by following our structured approach.

How do you keep yourself updated with ongoing industry trends?

My main strategy for staying current is reading extensively. Besides books, I also keep up with social media. The online community is invaluable, as it allows traders worldwide to discuss current trends, technologies, and best practices.

Maintaining strong relationships with our software vendors and exchanges worldwide is also crucial. While we operate like an IT company, we don't invest in trading software platform internally because it requires constant updates and maintenance. Instead, we focus on trading and leave trading software platform to specialized vendors.

What is your future roadmap for yourself & your organization over the next five years?

Over the next five years, I aim to build a team that is 100 percent tech-savvy. We've successfully developed many traders, but now we're focusing on creating a highly sophisticated, automated trading system. We're aiming for microsecond-level automation to enhance our trading capabilities. Currently, all our trades are automated, from data wrangling to execution, but we avoid developing our own software to stay focused on trading. My goal is to further refine this automation to achieve even greater efficiency.

As a leader in the industry, what advice would you give to upcoming leaders?

I believe many companies in Malaysia, and even in Singapore and Hong Kong, face a problem known as 'technology debt.' This occurs when initial system designs lack a long-term vision, leading to costly and time-consuming issues later. For instance, while Python is excellent programming language for analysis, it falls short in execution, leading to inefficiencies and errors.

My advice to industry peers is to plan with a long-term vision. Ensure that your mechanical and automated trading systems are designed with future growth in mind. Avoiding technology debt from the start will save significant resources and effort in the long run.

Alex Koh Hang Wee, Owner, ALGOPEDIA

Alex Koh Hang Wee is a seasoned professional specializing in investment management, financial analysis, and strategic planning, with a proven track record in driving business growth and optimizing investment portfolios.