Things to look for when choosing a trading platform


Deciding on the best trading platform for you is an important first step in your trading career.

This could be achieved by finding the answer to technical questions such as: do you need a trading platform that offers the ability to place conditional orders such as a trailing stop loss order?

There are many trading platforms available, the most common being MT4 and MT5.

Although they are considered basic trading platforms, they can be considered quite clunky and difficult to use and therefore, not a good idea for those who are just starting out.

Using the brokers in-house trading platform (clients can only trade via spread betting and CFDs) is a great way to start when that particular platform offers the key ingredients that many traders are looking for. experienced.

They are the best 3 questions every trader should ask themselves before choosing a trading platform:

1 – What is the main device I use to trade and do I only trade at home or also on the go?

Sometimes we will be trading on our laptops, other times we will be away and need to complete a transaction on the mobile phone or tablet. Using the MT4 mobile trading app is certainly much less visually pleasing than most in-house trading platforms.

It is important that the graphics you see are easy to use. For example, we don’t want to add trendlines to a chart, only to see them jump across the screen without your consent.

If you are a trader who often watches the markets on your mobile phone, be sure to choose a trading platform that offers great charting capabilities. It is also important that the mobile application offers as many functions as the desktop or web version.

Depending on your preferences, you might prefer to trade on a web version or a desktop version.

There are pros and cons to both.

A web version can be accessed from anywhere and is useful for those who are often on the move, but a desktop version can be left open 24/7 allowing you to use trading tools from copy or automated trading tools and manage the account from a remote desktop computer. for uninterrupted use.

2 – Does my trading platform offer advanced charting tools?

If you just trade once every 6 months, maybe a basic charting tool is all you need. But for those who trade several times a week or even several times a day, advanced charting tools can become essential.

So, you should ask yourself the following questions if you trade often:

– Can I add indicators such as Fibonacci Retracement, RSI or MACD to my GBP/USD trade?

– Can I use the profit and loss tool (Fig. 1) on my EUR/USD trade?

Fig. 1 Profit and Loss Chart Tool

– – Can I use the measurement tool (Fig. 2) to calculate how many pips there are in a candlestick?

Fig. 2 Measurement tool display

– Can I easily check the high, low, open and close prices of an individual candlestick?

– Can I drill down daily charts to see price movements of 8 hour, 4 hour, 1 hour, 30 minute, 5 minute, 1 minute and even tick (second) charts?

– If I am a fundamental news trader, how fast can I switch from a USD/CAD chart to GBP/JPY without any delays or interruptions and with fast loading speed?

– Can I add text, boxes or images to my graphics?

– Can I switch between candle charts, area/line charts or even less used charts like Renko?

If the trading platform you choose has checked most of the above items, you are on the right track. If you found the mapping software to be quite limited, it is also perfectly usable. It all depends on your trading style and how the platform suits you.

3 – What type of orders can you place?

For starters, market and limit pending orders are all you might need. But when you start investing time and money into a particular strategy, you might have found that using entry orders could be the way to go.

The most common types of entry orders are:

– OCO orders

– Stop order

– Trailing Stop Loss

What is an OCO order?

Placing an OCO order involves placing two limit orders in opposite directions.

You go long and short at the same time. When the price hits one of your positions, the opposite position is closed and the one just touched is triggered. This is useful for example when trading during highly volatile periods.

It’s just a lot faster than placing two limit orders.

Stop orders are another useful form of trading. Stop orders, different from limit orders, are orders placed only when the price has reached a specific target price level that you set.

Trailing Stop Loss orders could be a way to increase profits. However, it can also reduce them. It is therefore important to test a trailing stop loss before implementing it in your strategy.

A trailing stop loss occurs when you are in a trade and make a profit. Once the price has reached your first target, you can set a trailing stop loss that only closes your position when the price suddenly reverses.

Otherwise, if the price continues to rise, your trailing stop loss is moved up and therefore your minimum profit increases.

Can I copy trade or use automated trading?

If you haven’t thought that far yet, this might be something to watch out for.

Having the ability to copy trade is great for those short on time.

You can rely on others to trade on your behalf with the click of a button. If the platform offers it, it can be an advantage for you.

Automated trading is a more complex feature where the trading platform automatically places trades on your behalf based on a set of rules (or coding) that you give it. In MT4 and MT5 these are called EAs (Expert Advisors).

You can write or have code written for you and install EAs to enable automated trading.

These mechanical trades are advantageous in that they eliminate the emotional decisions that human traders make.

Summary

It is important to choose the right trading platform that suits your trading styles.

The best trading platforms will offer advanced charting tools which are useful for intraday traders.

Then there are those trading platforms that offer copy trading and auto trading tools, these are useful for those struggling to generate profits on their own terms.

In order to make sure you have chosen the right trading platform, ask yourself what type of trader you are.

Once you understand this, open a demo account with your trading platform of choice and make a few trades before opening a funded live account.

Spread bets and CFDs are complex instruments and come with a high risk of losing money quickly due to leverage.

The vast majority of retail client accounts lose money when betting on spreads and/or trading CFDs.

You need to ask yourself if you understand how spread betting and CFDs work and if you can afford to take the high risk of losing your money.

The marketing of CFDs and spread betting is not intended for US citizens, as prohibited by US regulations.


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