Overview of Basic Forex Trading Platforms

Overview of Basic Forex Trading Platforms

When you begin your journey towards successful forex trading, the specific platform you decide to use can make a world of difference. Although the platforms don’t affect the market in any way, their ease of use can determine whether or not you will spend the necessary time investing your assets and allocating your funds. In order to be considered a decent trading platform, it should meet a minimum of the following criteria:

  • Allows for mini-lots as well as standard lots; the availability of micro-lots is a bonus.
  • Allows for automatic trading (through presets that you define when setting up the trade)
  • Offers pre-loaded strategies

While your use of these features is not obligatory, it is helpful to know that they exist. This puts certain expectations in place and ensures that you will not be taken advantage of. It’s important to realize that there is still a large risk of loss associated with forex trading, but the outlined criteria will help to minimize this risk (as much as is possible).

So, which platform is best?

This is the part that gets tricky. There really is no “best” platform as this decision is based on your personal preferences. Some platforms require quite a bit of knowledge to operate, and are therefore not advised for new traders, but they may offer features that more experienced traders are unable to find elsewhere. In this sense, your experience would determine your success with that platform.

Other platforms offer back-end script rewriting to allow for greater customization, while others offer limited customization through pre-built application blocks. In this scenario, a user who is a professional script writer by day would have the advantage with the platform allowing for direct script access, but would likely be frustrated with the limitations of the pre-built blocks. It’s all a matter of personal opinion.

Generally, the “top 5 platforms” are accepted to be Trading Station, MetaTrader 4, NinjaTrader, MirrorTrader, and ZuluTrade, respectively. Of these, MirrorTrader and ZuluTrade offer the least features to the user which isn’t automatically a bad thing. Less features means less to learn, after all, and they still meet the minimum qualifications of a “decent” trading platform as outlined above. For users who would like to be able to perform one-click trades or chart trading, however, these platforms will not accommodate.

If you require the ability to view your trades in multiple formats web, desktop, and mobile versions – without the use of third-party applications, Trading Station is the only platform on this list that allows for that. You can have greater luck with the other platforms and the unofficial third-party applications available, but in terms of out-of-the-box function, it’s difficult to develop an individual setup that allows for cross-device trading with ease. (Naturally, web trading is the most common, as there are no installations required, and any online brokers will have this function by default.)

For the top three platforms mentioned (Trading Station, MetaTrader 4, and NinjaTrader), back testing is done to predict the future performance of a particular currency being traded. While this is not necessarily an indicator of future growth, it can help to see the anticipated direction based on past results. Keep in mind that there are no guarantees with forex trading and just because extensive back testing is done does not mean that the currency will perform the same in future market hours.

With a basic understanding of your criteria for a good forex trading platform, you can minimize your risks (at least as far as can be expected within the limitations of the trading market).

Categories: Tutorials

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