Professional trading platform
What is a professional trading platform?
Thanks to technical improvements, the modern trader or investor can work from home. Whereas in the past you had to give orders to a broker over the phone, nowadays, you can do it from anywhere with an internet connection. This requires special software to access the exchange, in other words, a specialized trading platform. In this case, it is a trading platform, where a user conducts financial operations and seeks to make a profit. The net is now overflowing with different trading platforms, so it is hard for a beginner in online trading to find the most suitable option.
What to look out for when choosing a professional trading platform?
A professional trading platform should allow trades to be executed as safely and as quickly as possible, because just a few seconds of delay can turn into lost profits or even serious financial losses.
Modern trading platforms offer many tools for the trader, including built-in economic calendars, news sections (the news flow must be real-time and historical data must be available) and the ability to perform technical analysis right on the platform. An understanding of technical analysis is useful not only for speculators, but also for investors, for whom it is just as important to open and close trades at better prices. A technical analysis toolkit should be filled with various technical indicators and charts to ensure a versatile approach to research.
Quotes on the best electronic marketplaces should be available around the clock, and the number of windows in which they can be opened should be sufficient. Timeliness and promptness of information, combined with its completeness, will allow you to develop an optimal trading strategy and determine with high precision when to open/close positions, all operations should be performed instantly and comfortably.
Online platforms can vary greatly in the trading tools they offer. For instance, some platforms offer many features that enhance the trading environment, while others offer only basic services. But what investors and traders really want from a trading platform is performance, security, functionality, simplicity and a user-friendly interface (so the user does not get lost in it and can easily find what they are looking for). The changes in the capital markets are extremely dynamic, so a trader needs to be able to react quickly and be in control all the time. If an investor travels a lot or does not like to use a computer, a mobile app would be ideal, as it makes life much easier. If the terminal is set up correctly, you can even receive notifications on your phone when certain events occur (currency moves up to a certain level, or a trend is formed). Before you make any choice to trade on any online platform, it is important to read feedback from other traders.
There are many discussion forums on the Internet where you can ask questions and get answers from experienced participants.
You can talk to people on these forums and get information about the platforms they use, how they use them, and which ones they like or dislike. This information will help you make the right choice.
Let's take a brief look at platforms adapted to specific markets.
A platform for online stock trading
Stocks have always been and will always be the most accessible and popular instrument on the stock market. In turn, the market makes it easy and straightforward for professionals and beginners alike to buy shares of companies.
This is the niche where huge profits are made and investments are increased several times over. Traders in the stock market operate in two methods. The first is to buy shares at a low price and then sell them at a higher price. In this case, profit is derived from the price difference between the securities. The second method is buying shares to receive dividends. Trader's investments yield a stable passive income. Bidding on short-term investments, a very convenient tool - CFD on shares - is often used. Such a contract allows profiting from price changes of shares of global companies without owning the share itself.
How is a CFD convenient?
- First, you don't need a big capital to open an account and trade.
- CFD trading allows the use of leverage. Trading with financial leverage may help to multiply initial capital, but such trading is risky.
- Because CFDs are both buy and sell, they can also be used for hedging purposes.
A platform for online forex trading.
Millions of trades occur every day in the Forex market, all of them backed by currencies. The market turnover is measured in trillions of dollars. Today, Forex has taken a leading position as a round-the-clock international marketplace for foreign exchange transactions.
The foreign exchange market allows you to buy and sell currencies and to make transactions with foreign investments.
Forex sets the price of different types of currencies on a daily basis. By using online trading platforms, exchange rates for all currencies are displayed and traders can trade all available currency pairs, thus making profits from speculating on price movements. It does not usually require a lot of money to start trading. Before making a trade, you select two different currencies. One is the base currency and the other is the quoted currency. For example: EUR/USD (EUR and USD): The base currency is the Euro, and the quote currency is the USD.
In order to make a profit, you need to forecast what the currency price will be in the future, be it in 5 minutes, an hour or a week. Depending on the forecast, a trader enters or exits the market.
With leverage (margin trading), forex traders can make high profits from a single trade without risking a large sum of money. As soon as the trader has positive percentage of successful deals and exact ratio of risk and profit, it is possible to gain stable income. Technical and fundamental analysis is of great help in this. Please remember that the situation on the currency market depends on many political and economic factors, the behavior of the world's major banks, funds, and companies.
Online platform for trading options
The options market gives beginners a great chance for a quick start without impressive funding. Any newbie can come here with $100 to invest and in one day have profit on top of the initial deposit. But it is not as easy as it seems. You need serious training, in-depth study of technical analysis, development of your own strategy, and much more.
What is an Option? An option is a contract which allows you to buy or sell an underlying asset at a future date, but at a fixed price. And what is important - it will be your right, but not your obligation! Because if the market situation is not going to be good for you, then you will be able to reverse your decision and cancel the deal. Basically, by trading options, you reduce your risk to a minimum.
Every option contract has three important components: the premium, the strike price and the expiry date.
- The premium is the value of the contract for which the trader buys it.
- The strike price, or strike price, is the exchange rate of the underlying asset at which the option will be exercised.
- Exercise date is the date on which the option can be exercised; when that date expires, the contract expires.
There are two types of options:
- Call (call) - the future purchase price is fixed.
- Put options fix a future sell price.
By buying a Call option, the trader is waiting for the market to go up. By buying Put options, the trader benefits from the decrease in price of the underlying asset in the market. Trading options gives several advantages: less initial capital, leverage, hedging instrument, fewer commissions, risk and loss is limited for option buyers, flexibility and possibility to form options strategies.
Binary options are one of the newest and most popular derivatives currently offered in the trading world. Binary options are easy to trade and limit trader's investment risk to the amount paid to purchase the option. The popularity of binary options has grown considerably since they became available for retail trading on online platforms. In addition to currency pairs, binary options can now be traded on many of the world's major indices, commodities such as oil, gold and silver, as well as stocks of many companies.
Online platform for commodity trading
The commodity market includes buying and selling instruments such as grains, sugar, spices, coffee, cotton, oil, lumber, precious metals, etc. A trader can choose from a hundred different items and invest in this sector of the market. As a matter of fact, the commodity exchange is not inferior to, and sometimes even superior to, the stock and currency markets, as far as earning opportunities are concerned. The profits of speculators on this market are as high as when trading in securities, currency pairs and indices.
Commodities are widely regarded as the most predictable among professional speculators. Despite the predictability of the quotes, commodities have a level of volatility comparable to currency pairs. And it is quite a handy tool to make money. The commodity exchange provides opportunities for speculators to earn both in short-term and long-term trading. Because of the way commodity prices fluctuate, they can often be used as a hedge against inflation. For many traders and investors, commodity trading is the preferred way to protect funds and reduce the overall risk to their portfolios. Commodities are traded using CFDs on the platform. Trading CFDs offers additional flexibility in your trading, but also increases your risk exposure.
CFDs are not the only way to trade commodities, there are also ETFs that track several types of commodities, as well as investing in or trading shares of companies that produce commodities.
Online platform for ETF trading
An ETF is a set of stocks that are traded on the market as a single instrument. There are index ETFs that copy a stock index, commodity ETFs for a specific group of commodities, such as precious metals, industry ETFs that include stocks of companies from a single sector and others. ETFs are a relatively new but gaining popularity instrument in financial markets.
When you buy a stock in a fund, you begin to own stakes in all the stocks in that fund. The upside is that you diversify your portfolio for a relatively small amount of money.
With ETF shares, you can perform all the transactions that are available for common shares in stock trading. ETFs can be traded in many ways. That means they can be traded speculatively, intraday, they can be traded in the medium term or held as a long-term investment position. It all depends on your trading strategy, which in turn determines whether you will use technical or fundamental analysis.
Online cryptocurrency trading
In order to profit from trading, cryptocurrencies currency is bought cheaper and sold at a higher price, while trying to minimize possible risks. In other words, it is the same as investing in regular currency. Naturally, the basis of instruments and the principle of setting trading targets are set in the same way as in the stock markets or forex. Making a profit trading virtual money will not be a problem for those who know the basics of trading stocks, securities and national currencies.
Many traders select currencies from the top ten for their investments. They have a large market capitalization. These include Bitcoin, Etherium and Monero. Top currencies are easy to buy, sell and exchange. Before you start buying and selling cryptocurrencies, you should first learn basic risk management techniques and how they protect your capital.
The most important thing is to learn how to use stop-loss and target profits. A stop-loss is a market order that takes you out of a losing trade, while a target profit is the point at which you would like to exit a winning trade before it triggers. You must also learn how to use limit orders - the maximum price at which you are willing to buy a cryptocurrency.
Online index trading
There is a method of investing in indices. For example, there is the Standard and Poors index (S&P500). This contains the price movement of shares of 500 American companies, another example is the Dow Jones Industrial Average, which tracks the movements of the 30 biggest US industrial companies. And there are many such indices.
Indices are financial instruments. They show the aggregate value of the major companies, in a given market or industry.
Changes in the value of an index reflect fluctuations in the value of the shares of the companies included in the index. Trading in the OTC market takes place in the form of contracts for difference (CFDs). Trading CFDs on indices gives you the chance to increase your capital on blue chip stocks, i.e. stocks of the largest companies. For example, Boeing or Coca-Cola. The capitalization of your portfolio can grow together with the market giants if you select them.
How to start using a professional trading platform?
One of the right decisions before getting started in trading will be to choose a broker. Choosing the right platform for you is not an easy task, and you need to approach it consciously and carefully so that the platform suits your trading style, market and purpose. If you have already made your choice and know which professional trading platform you will use, all you have to do is register and start earning.
Go through the registration process
The developers of the e-platforms have taken care to make the registration process as quick and easy as possible.
Therefore, you should not have any problems with it. You will have to enter personal data requested by the system, it is obligatory to enter an email address and a password. After completing and submitting the form, you will receive an email. To activate your account, click on the link in the email. Be careful and send accurate information about yourself to avoid problems with withdrawal.
Many investors and traders are wondering if they should open a demo account or go straight to a live account. But a demo account is a prerequisite for beginner traders preparing for real trading. Demo account is an essential stage to prepare for real trading, as advanced traders may try out new trading strategies on their demo account. You need a demo account to put the acquired knowledge into practice, without the risk of losing money.
A demo account has no expiry date and may be added to as many times as you wish. The only difference between a demo and a real account is that in the demo-mode trading is done with conventional symbols, not with real money or assets.
Everything else - the price action, the trading tools, the execution of orders, the market situations - must be the same. A demo account must always be ready to trade, so that you can quickly work out the best course of action for any specific situation, for example in case of a sudden change in the exchange rate. In order to move to a real account, trading on a demo account must yield a steady "demo profit".
When you open a trading account, you make a deposit of the amount specified for the platform. To do this, accept the contract from the broker. You can do this with a simple click.
So, the deposit amount is usually small, only a few dollars, but you can also deposit a larger amount if you wish. It all depends on your goals. Using the payment systems the terminal offers, you can both deposit and withdraw your funds whenever you want. Some brokers now support popular e-wallets.
It is not superfluous to say that before you make a deposit, you should ask about commissions and charges. And also you have to choose the payment method, the currency type and only then deposit the amount you want.
To conclude the article with a piece of advice.
Choose brokerage companies that have been on the market for a long time and with good reviews, which are included in various ratings - there are a lot of them on the Internet. The best professional platforms offer free training, a free demo account and reasonable initial investment amounts. Technical support on such platforms is available 24 hours a day. This is important because you can always talk to a support agent, no matter where you are.