Currency trading platform in which is a software interface that allows the customers of currency brokers to access forex markets as a trader. This platform can be an online, web-based portal, a downloadable standalone program, mobile app, or a combination of these. Aside from tools for processing orders, it can also provide tools for research.
More about Currency Trading Platforms
Currency trading platforms give traders tools for trading (buy and sell orders) in the Forex markets. Forex brokers made platforms ready to use for their clients. There are some Forex brokers who offer custom trading platforms to process orders and do research though there are a lot who provide order access by integrating trading and research programs. The most used trading platform so far is MetaTrader 4 (MT4). MetaTrader 4 is not an open-source software but it allows trading system developers to create scripts and automate trading algorithms within its framework. MT4 is an openly extensible platform.
Many brokers offer MT4 along with their own platform because it is widely used among retail traders. With this, those retail traders who are familiar with the platform can easily migrate their own tools to the new brokerage.
Several currency trading platforms were also offered by many Brokerages for both retail and institutional clients. Proprietary currency trading platforms can also be built for institutional markets, brokerages or banking companies to address their certain needs in executing trades via institutional trading channels.
Foreign Exchange (Forex) Trading
The Forex market is the largest globally. It offers a lot of benefits that attract a lot of day traders. This market is exclusive in currency trading. It is reported by the Bank of International Settlement that daily forex volume tri-annually is $5.1 trillion per day which is traded in 2016 compared to 2018 average daily trading volume of 6.6 billion shares or $330.6 billion in the U.S. equity market. Generally, traders can have a huge opportunity to have a profit in the foreign exchange market. Forex market is also available for trading 24 hours a day, five days a week which adds to its potential to produce a profit.
Features and Considerations on Forex Trading Platform
When determining a currency trading platform, retail traders look for these some popular features:
- Availability of Currency Pairs – an important feature since forex trading depends on the pairing of two currencies.
- Ease of Installation and Use – this leads to a comparison of the web-based platform against downloadable platforms. In this, traders can choose a platform either directly from their brokerage or with a standalone service.
- Fees – another important consideration since costs can vary depending on the individual systems.
- Functionality – a key aspect for most traders because they usually rely on the charts and ordering methods available in the system.
- Brokerage trading platform in which the forex trading platform is integrated
Interactive Brokers or TD Ameritrade are famous brokerage options since they offer access to all asset classes. IG and Oanda are famous among forex traders since they are specialized in that market and offer reasonable rates.
A lot of currency trading platforms allow a trader to create a demo account before funding a full account. A trader can decide on the best one by trying out several forex software trading platforms trial periods.