Trading platform is a software used for trading, including opening, closing, and managing market positions through a financial intermediary such as broker.
When you decide to join a broker and choose forex as your trading instrument, broker will give you access to a trading platform. Trading platform is a software used for trading, including opening, closing, and managing market positions through a financial intermediary such as broker. These platforms oftentimes come with many helpful features, like charting tools, news feed, real-time quotes, and so on.
Forex brokers, Admiral Markets as an example, give trader access to trading platforms for free or at discount prices. To provide a satisfying and comforting trading experience, a broker might give you some options for trading platforms. You can choose a platform that fits your needs and your hardware (PC or gadget).
Most of the broker allows you to open a demo account before depositing real money into a mini or pro account. You can use this chance to observe trading platform they provide. Spare some time to try each software they give you access to during the trial period. Here’s what you should be looking for in trading platform:
1. Make Sure It's Responsive
To start trading forex, one important thing you should observe in a trading platform is responsiveness. This aspect is very crucial because it will affect how your order would be executed due to the high volatility of the forex market.
For example, a trader is placing a stop-loss order but because of high volatility, the order is not possible to be placed in the desired value. So the order would be placed at the next possible value even if sometimes the trader not going to notice. The problem is if you're trading in the slow-response trading platform, this will affect your order. It will make your trading plan goes to waste because your trading platform doesn’t execute it fast enough, leading to unfortunate situations like slippage or even requote.
2. Make Sure It Can Work Well
Responsiveness is not the only technical thing you need to observe in your trading platform. It's necessary to make sure the platform works well enough like it does not crash or freeze often. You can imagine how annoying it would be if you miss a highly significant moment in trading because of the trading platform crash. Basically, brokers provide MetaTrader 4 and MetaTrader 5.
If you plan to trade frequently or even become a full-time trader, you're going to need a stable platform that never or rarely crash. But if you are a passive and conservative trader who does not always stare at charts movement, it will be more flexible.
3. Make Sure It's Easy to Use
A broker might give you some options for trading platforms. Pick one of them that is easiest to use. Yes, the trading platforms should be user-friendly which means you can place an order or closing a trade in a quick way. It doesn't make you confused about how to use some tools, how to see a chart of a certain pair of currency, etc.
See also: Using Broker's Facilities the Right Way
A user-friendly trading platform will help your day-to-day trading activity less stressful. So make sure this category describes your trading platform.
4. Make Sure It Has Analytical Tools You Need
There would be a lot of things you need to consider before making a decision in trading. Such as economic news from a certain country, the conversation you read in an online forum, or even voices from your own head.
At this moment you need some analysis tools to make a technical analysis based on chart patterns. Making consistent profit without the help of analysis tools will be extremely difficult, it's like you're trading with eyes closed. Therefore you need to make sure your trading platform has analytical tools you're comfortable to use.
5. Make Sure It's Secure
Your data in a trading platform is very confidential, for this reason, you need to consider security issues. Of course, you don’t want to trade your personal data or other confidential things regarding your depositing money. Check the data encryption of your platform which will tell you about how decent your data will be protected.
Popular trading platforms oftentimes use firewalls on server and application level. Those platforms also have two separate synced servers to make sure the client's data is recovered from one to another. However, it's important to note that forex brokers' data can still be hacked despite numerous safety attempts implemented in the platform and/or broker system. In this case, the way the broker recovers from such an event would be proof of its quality.
So, those are five things you need to look for in your trading platform. If you feel like your current platform does not work well enough, make your trading activity clogged up, don’t be doubt to change it. Don't forget to tell your forex broker about troublesome you have with your platform.