A trading platform refers to software built to help traders manage and execute market positions. These platforms are used for forex trading, stocks trading, and crypto trading. They usually come with features, including real-time quotes, charting tools, news feeds, and even premium research, enabling traders to make the right trading choices.
Types of trading platforms
There are two main types of trading platforms; prop platforms and commercial platforms. Let me explain how these two types differ.
These are mainly used by day traders and retail investors who don’t need a lot of complex functionalities and customization. They usually have a few useful features such as news feeds and charts to help retail investors and day traders to make investment decisions.
These are customized platforms created by large brokerages to suit their requirements and investment style. These usually have a lot of custom features that can only be utilized by professional and experienced traders.
How to choose the right trading platform
There are hundreds of online trading platforms on the internet, and choosing the right one for you may sometimes be a challenge, especially if you are new to this whole trading thing. Let’s share some of the factors you need to consider to make this easier for you.
One of the first things you need to consider is the appearance of its interface. You need to choose a trading platform with an interface that is straightforward and not intimidating for a beginner to get started. Remember, it is the user interface that you will interact with most of the time, so choosing one that is minimalistic and easy to use will significantly shorten the learning curve.
Choose a platform that suits your needs.
Don’t use a trading platform because everyone else is using it. Go for one that is specifically tailored for your needs. Each trading platform is created with a specific category of users in mind. So, take your time to find one that meets your needs. You could contact your stockbroker to help you choose the best ones.
Stability and performance
You need to choose a platform that has a good reputation of being stable while offering optimal performance and has reliable affiliate program. All the great features a platform offers will not matter if it is on and off. You may have to read reviews of previous users to find out their opinion regarding the performance and stability of the platform.
Go for functionality over features.
If you are just a beginner, it is essential to choose a platform that does the basics well instead of choosing one with flashy features. Most of the time, you will not use these features, so choosing one with many features may further steepen your learning curve. It is best to choose a platform with just enough features to get started. The good news is that you can switch to a more robust trading platform if your needs change in the future.