OpenBB vs. Bloomberg Terminal (Open Source Challenger)
OpenBB is an open-source challenger to the Bloomberg terminal.
Financial Traders, Portfolio Managers, and Sales People have long used the Bloomberg terminals worldwide to manage their portfolios, gain insights into their investments, and communicate transactions and market information.
I certainly did for twenty years in various financial institutions. Bloomberg was the primary communication and trading platform, especially for those involved in fixed-income and bond markets.
However, as time has passed, the Bloomberg terminal, although making efforts to support the open-source community, has remained essentially closed-source (proprietary), particularly around access to underlying data.
Bloomberg does not support all the freedoms that creative developers seek outside the ecosystem.
This is where OpenBB — the open-source challenger — has spotted an opportunity and is starting to gain prominence as a genuine alternative to Bloomberg for those with knowledge of Python.
Key Points
- OpenBB emerged as an open-source platform programmed in the popular Python language for anyone who wants to learn about trading strategies.
- Python is a powerful way to connect APIs, analyze data, and integrate with OpenBB.
- OpenBB works on all platforms and devices, such as Windows and Linux.
- It’s a new way for researchers and analysts, particularly those familiar with Python, to access financial data.
- OpenBB comes with an increasing range of features (machine learning and predictive models) that can be personalized and compete with Bloomberg Terminal.
- OpenBB is free, a Bloomberg Terminal that can cost upwards of $24,000 per year.
If you are searching for open-source software to help analyze real-time financial information from multiple sources, OpenBB could be the alternative you are looking for.
But how is it a challenger to the Bloomberg terminal? Read on.
What is OpenBB? (open v closed source)
OpenBB is an open-source platform that provides financial content, analytics, communication tools, and features.
The product is very early-stage, and the interface is primarily the command line (CLI).
A community of developers and users can share and release new features, ideas, and information about the industry.
OpenBB offers a forum for those interested in finance with live chat support.
The platform allows users to post stories, share updates, and discuss financial issues by collaborating with colleagues, competitors, and peers.
For instance, a contributor interested in the foreign exchange market can create a version to suit their needs.
By contrast, Bloomberg is closed source — a walled garden — where the public lack access and transparency to the source code.
The platform is incredibly secure but comes at a cost financially and in terms of innovative features.
What is the Bloomberg terminal? (The Financial Social Network)
Bloomberg terminal is the world’s most widely-used financial data and news service software.
When I started using Bloomberg in the 1990s, as a young fixed-income trader, most traders and financial professionals still used pagers and brick-like mobile phones.
The system was simple, with a dedicated “Bloomberg” keyboard and bright-colored buttons that appealed to traders, especially the dinosaurs on the trading desk (old traders from the 1970s and 80s) — most of them still used pen and paper.
Bloomberg also had a shallow learning curve. You certainly did not need to be a programmer or even know how to use Excel to use basic functions like messaging and charting.
Once Bloomberg became the industry standard in the bond market, social network effects took over to entrench its position.
Bloomberg has since expanded into other markets like FX, Equities, news, and even crypto.
The costs of learning a new system are high, and more so if no one was using it!
Financial salespeople could directly access traders and portfolio managers (including big hitters) and conduct trades in the Bloomberg messaging system.
The network provides the value.
Today, Bloomberg information is up-to-date from financial institutions, markets, and news channels and uses the latest technology. It offers a first-rate search engine and organizes news from different sources at a fee.
Also, it is an excellent tool for professional and amateur investors. Generally, it works well for traders already comfortable working with Bloomberg terminals.
What are the features of OpenBB and Bloomberg terminals?
| Open BB Terminal | Bloomberg Terminal |
| Primarily stock and FX trading | Customizable workspace in a closed-source system |
| Investment tracking | News option |
| Option menu tools | Stock quotes |
| Beautiful design with a clean interface | Charting tools |
| Multi faces simultaneous sessions | Market data |
| Support for Unicode characters | Real-time data |
| Support for transparency in background images | Mobile access |
| Support for control sequences like tabbing and scrolling | |
| Has a command line history system |
What are the differences between the OpenBB terminal and the Bloomberg terminal?
Bloomberg and OpenBB are terminals that provide real-time data but have some key differences.
OpenBB is available for free download, whereas Bloomberg terminal is a subscription-based service that requires a significant subscription fee (upwards of $24,000 per year).
Bloomberg does not limit data. It offers data from every country and stock exchange, whereas currently, OpenBB focuses on top US exchanges, which will expand over time.
The Bloomberg terminal is a more advanced trading tool and the industry standard. It has features such as:
- Instantaneous quote updates
- Ability to download data directly from the market
- One-click order entry for futures contracts
The advantage OpenBB has is the new generation of analysts and business school students are familiar with the Python programming language from their training. Since OpenBB is built around Python, being open source, they can integrate and build on learning from their studies.
Python is a powerful way to connect APIs, analyze data, and integrate with OpenBB.
OpenBB terminal is a free terminal for basic trading and is best for newbies who want to learn the basics of trading, testing, and trying out their ideas and code.
Moreover, OpenBB is a terminal for trading stocks, while Bloomberg is a terminal for trading all asset classes, including bonds, currencies, commodities, and indices.
As a result, traders often refer to OpenBB as “the stock market” and Bloomberg as “the bond market.” This is because OpenBB focuses on stocks, whereas Bloomberg focuses on bonds.
OpenBB also differs from Bloomberg in its interface. Even if they provide access to real-time prices for their respective markets, OpenBB’s interface uses a lighter color scheme than Bloomberg’s. It also has fewer buttons and a more intuitive layout.
The Pros of OpenBB
OpenBB is open source, available on the internet, and people can easily access the code bases.
OpenBB Terminal is currently an early-stage developmental product and is pitched as a “Python-based integrated environment for investment research.”
Python is powerful and allows traders to access data science and machine learning smarts to process unrefined data.
OpenBB is deployed via a command line interface (CLI). A proper GUI is in development for regular users.
The platform gleans its investment data via publicly available sources, requiring an API key — Alpha Vantage, Financial Modeling Prep, Finnhub, Reddit, Twitter, Coinbase, the SEC, and many more.
OpenBB leans on machine learning across myriad use cases. For example, it can look at Google’s share price over the past week, grab news headlines via one of Finnhub’s APIs, derive sentiment from each headline using natural language processing (NLP), and then correlate the impact of news on Apple’s share price.
While finding data on other platforms can be a hassle, the OpenBB terminal will help you find what you need.
Apart from being user-friendly and open, it offers a better selection of applications and features. This means you get more functionality out of your device than others.
Another benefit is the provision of real-time market insight.
The main reason behind this is that it offers more information about the market trends. With this tool, you can watch live price changes and current transactions in your account, thus a good tool for investors and traders to understand market patterns.
The Cons of OpenBB
OpenBB terminal does not offer any security features. For instance, if two people have access to your computer, they can view everything you are doing at the terminal.
Security protocols will develop around the platform as open-source security standards are adopted.
Therefore, you must be careful about the information you share and the people who can access your account.
Security protocols will develop around the platform.
Final Thoughts
The Bloomberg terminal is an established, powerful financial market news, messaging (social), analytics, and data platform with few genuine competitors.
However, there is always room for disruption as technologies evolve. New entrants such as OpenBB are giving it an early-stage challenge.
Traders who use OpenBB potentially have access to the same data that analytical professionals using the Bloomberg terminal have, but at a fraction of the cost. In addition, OpenBB will move the market towards increasing transparency.
Indeed, OpenBB is an open-source challenger to Bloomberg terminal because it applies to individual or institutional trading.
Technologies like OpenBB are worth experimenting with, especially as the technology evolves.
