Electronic Trading Platform
What is an electronic trading platform?
Whether a trader is a professional or a novice, using the best technology to buy and sell trading assets is crucial. According to economic studies, the daily frequency of online commerce has almost doubled. Therefore, there are countless online software programs available for trading, claiming to be the best platforms for trading the financial markets. Choosing the best electronic trading platform can be a daunting task. Let's look at what you need to pay attention to when making your choice.
Important features of a brokerage platform
For novice traders, the most important thing about the platform is the intuitive controls. A person for whom everything in the platform is new, the comfort of work is important. And as they gain experience, the functionality of the platform becomes more important.
An electronic trading platform is a website that uses a computer program to execute exchange trades in a fully networked environment with real-time quotes.
Investors and traders today can participate in stock markets through electronic platforms from the comfort of their own homes, whenever they want. All transactions can be made online. After all, a broker is an intermediary between the markets you want to invest in and you. An e-broker will store your account information and look for market positions on exchanges and markets where you can buy and sell.
Brokers platforms allow investors to manage their investments online via PC and also give you a handy mobile app to make your commerce even more successful. Now you don't have to wait until you're at your desk, all you have to do is look at your phone, it's very convenient, make sure you take advantage of it!
It's convenient to manage your account by having an account on an electronic trading platform. Your account will contain a history of all your trades, you will be able to see the profits in your account and analyse the situation. Which strategy is giving you the most profit, which particular asset is giving you the most profit, etc.
Most platforms come with online demo accounts. These programs do not require any capital investment. Make sure that the platform has this feature.
Note that brokers often offer not only trading, but also water-training. They offer a guide to day trading, long term investing and beginner's trading. Videos are provided by experts in the field and can help investors make better choices.
How do I analyse assets on a platform?
Analysis is used by almost all traders. Regardless of experience and skills. Without it, your trading turns into a roulette and your chance of making money decreases manifold.
The first and most fundamental type is the fundamental analysis. It is so called because it studies the basis of price behaviour. What caused the share price increase, why the price of a currency decreased, etc. For this purpose the trader studies the news, the economic calendar. Everything depends on the asset you are analysing. The main relevance is given by the political, social and economic news, news about the company of the issuer if you are appraising a share etc.
The second type of analysis is technical analysis. It is also called mathematical or graphic analysis. It is presented in the form of various graphic models, indicators. The factors influencing the price are already included into the chart. That's why, without going into the essence of economics, it is possible to forecast the price direction. But it is difficult to understand the general market movement. Indicators, charts, and oscillators show a part of the picture. One particular case in the time interval. Nevertheless, you can choose different timeframes on the chart, both short and long.
Ideally, you should use both types of analysis, only then you will get the fullest picture and be able to accurately predict the behaviour of an asset, and thus make a profitable trade.
Types of assets on an electronic trading platform
A good electronic trading platform can be used in several markets simultaneously. These include commodities, stock markets, currency markets, etc. This is particularly advantageous for investors who have diversified market positions. It allows them to enter and exit different markets at the same time, thereby reducing risk.
Diversification is a way of reducing investment risk by spreading capital across different investees.
The idea is simple: if one asset makes a loss, there is a chance that others will make up for it. In practice, diversification comes down to choosing instruments which, on the one hand, will protect the capital from market fluctuations and, on the other hand, will provide the required risk/return ratio.
Electronic platform for stock trading
A share is a security that evidences the holder's right to receive a share in a particular company.
There are 3 ways of working with stocks:
- Investing for a long term, from a year or more.
- Trading. Speculating on short-term price changes, i.e. quick reselling.
- Dividend strategy. Dividends are a return of value to shareholders, in the form of a portion of the profits of an organization, that is distributed to shareholders based on the type and number of shares they own.
The price of shares in the market is formed on the basis of supply and demand. Supply and demand for shares can be influenced by internal (company-related) and external factors.
Electronic platform for forex trading
The forex market is an international currency market, the youngest of the existing world markets and the largest market worldwide in terms of trading volume.
Forex currency pairs are the main tool of the currency market. Currency pairs in Forex reflect the value of currencies, i.e. a quoted currency indicates how many units of it are needed to buy a unit of an underlying currency. When an order is placed, there is a purchase of the base currency and a sale of the quoted currency.
Changes in supply and demand in the market cause the most liquid currencies to move in one direction or the other. You can make a profit on this market in two cases: you buy the currency cheaper and sell it more expensive, or you sell the currency more expensive and then buy it cheaper.
Electronic platform for options trading
Trading options has great potential, but also a high level of risk. Unlike other trading methods, options trading requires high analytical skills and a basic understanding of the terminology in options trading.
An option refers to a time-limited contract that gives the right to buy or sell any asset. From this definition, there are 2 key features of options:
- They give a right to buy or sell an asset, not an obligation.
- These contracts are time-limited, they have an expiration date, which is the time for which a trade is postponed.
A separate type is considered to be a binary option. This is an exchange contract, the profit of which is known in advance. You need to guess the direction of the price movement. Call/Put is a classic type of binary options. A Call is a bet on whether an asset will rise. The investor is betting that by the time the option expires, the price will be at least one point above the buy level.
There are only 2 options - trader gets everything at once, i.e. he gets his bet and profit if he guesses. Or one gets absolutely nothing, which explains the presence of the word "binary" in the name.
Electronic platform for commodities trading
Today, commodity trading is the backbone of the global commerce ecosystem. With the advent of online commodity trading, private traders have gained access to global commodity markets with a relatively modest amount of capital.
Commodities have become a popular vehicle for inflation hedging and portfolio diversification. For many traders and investors, commodity trading is the preferred way to protect funds and reduce the overall risk to their portfolios. The most liquid commodities are metals (gold, silver) and energy (gas, oil), as well as agricultural commodities.
One of the easiest and most popular ways to trade commodities is using CFDs. A Contract for Difference (CFD) is a type of contract between a trader and a broker to profit from the price difference between the opening and closing of a trade.
Electronic platform for ETF trading
An ETF is a financial asset created by some large investment companies for the purpose of diversifying their portfolios. The fund accumulates money from many private investors. A special organization, a management company, will use the money raised in the fund to buy different stocks or other assets, forming and managing a portfolio.
Buying an ETF is available to most individual investors and requires no special knowledge or professional qualifications. The low price of securities allows investors to start investing with small amounts. Buying ETFs is simple enough - just open a brokerage account and submit an application to buy the fund of your choice.
Electronic platform for cryptocurrency trading
It is a software code that is sold online. It cannot be obtained in the form of an existing currency. Furthermore, it can only be exchanged for money.
Cryptocurrency is stored in electronic wallets. Over time, the volume of cryptocurrency grows and this leads to an increase in the number of transactions. So this currency is becoming more and more entrenched in our lives. The exchange rate of cryptocurrencies is constantly changing, so every trader has an understandable desire to try bitcoin trading.
Electronic platform for indices trading
A stock index is a financial instrument, which is based on the average value of a basket of shares of lots of different companies. The index is also considered an indicator of a country's economy: its behaviour gives an indication of market sentiment.
Traders open CFD deals on the rise/decline of an instrument, which allows them to earn in any market picture and without large initial capital.
So now you have a general understanding of the different assets you can buy. So open a demo account and test different types of assets and tools for trading. Then it will be easier for you to learn stock trading.
How to start using an electronic trading platform?
If you are a newcomer and are looking forward to learning how to use an electronic trading platform, this article may help you. Exchange trading is becoming more and more popular every day and accordingly, there is a high demand for brokerage platforms.
As described above, a trading platform must have not only a terminal, but also additional features, which will provide you with the most convenient trading conditions. An electronic trading platform offers you news, charts, leverage, different assets to choose from, technical support, live chats, etc.
In order to enjoy all the benefits, all you need to do is to click the register button and go through a simple procedure by filling in your details and entering your email. Then, complete the registration by clicking on the link in the email. After registration, open an account of your choice.
Before you start trading, it is a good idea to open a Demo account. A demo account allows you to trade in a real environment, without risking your money. They allow you to gain experience and learn how the trading platform works. You will automatically have a virtual amount in your account, which you can use to make test trades and test your skills. Using this account, you can test various trading strategies. This can help you hone your trading skills and increase your confidence in facing a real trading platform. Once you are ready, you can open a live account.
A brokerage account is an account where individuals can buy and sell stocks and other financial instruments in the stock markets. It is required for trading. To open one, place a deposit in your account, complete your information, and you can start trading. All movements of funds will be shown in your account, profits will be deposited here, and deductions will be made from here when buying.
The last tip you can give is to be pro-active, be interested in all information concerning trading, learn and try to make decisions consciously and independently, this can lead to success, good luck!