How Important Is Your Choice Of Forex Platform?

When anyone wishes to begin trading forex the first decision they need to make is which online broker to choose

. There is a great deal of choice for a new trader when it comes to picking a broker and the competition between them is intense. There is often attractive offers for new traders to sign up or indeed for current traders to switch brokers. This competition is normally fought over a couple of key areas, the cost to trade being one, the level of service that the client receives is two and the third is the quality and effectiveness of the forex platform that they provide to their clients.

The importance of the trading platform should not be underestimated as the client is solely reliant on the quality, accuracy, safety, speed, mobility and ease of use of their platform in order to maximize their potential to profit when trading. As previously mentioned any platform software that is being looked at should provide the tightest levels of security for your account so that no one can hack into your private trading account and either withdraw funds or make trades. Another valuable feature is the ability to stream real time data for the client to see (admittedly this applies more to stocks and commodities which trade on an actual exchange). Also the trader should be comfortable using the platform and be able to find required information simply. The ability to make a trade should also be straight forward so there is no chance of making an error and putting in a sell order when it should have been a buy order or vice versa and then being able to exit the trade easily as well with a clear pip or profit reading on each individual trade.

Drilling down further into the forex platform software, a client should have the ability to easily set up stop losses or lock in profits and more advanced traders will also want the facility to set up trailing stops which automatically move in line with the trade. Any potential platform package must incorporate outstanding charting software. A large portion of information that a trader will need to actually trade will be taken from charts in one form or another. Charts should be able to be configured to intra-day readings, to a minute and hour scale or expanded out to chart the last 3 months, 1 year, 5 years, 10 years etc Multiple trades should be able to be performed and the platform should show clearly the trading balance on the clients account along with the margin (or leverage) being used.

Trading platforms generally come in 2 different forms, the generic platform that is used by multiple brokers. Of the various examples the most widespread and well known of these is MetaTrader 4. The second category of platform software is in fact developed, owned and managed by the forex trading company. Many of the makers of aftermarket forex trading programs such as forex robots and chart indicator packages will have designed their products to work immediately out of the box on generic platforms whereas there could be compatibility issues with in-house software. This type of software add on tends to be a little trickier to install and use on in-house systems although it is of course system specific and it is getting better all of the time and certainly the add on software producers are making an effort for their products to be as compatible as possible.

If you are a U.S citizen then certain online brokers will not allow you to trade for legal reasons, so find this out when conducting research.

Probably a smart move would be to download a demo version of the platform. This is more to do with checking how the platform works and performs rather than trading fake money. Once a platform is found that exceeds all of the previous criteria it is time to open up a live account.

by: Dan Jones

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