Online Forex Trading Platform

An online forex trading platform is the tool used by everyday folks such as you and me to trade in the currency market. For a long time, forex trading was only limited to banks and large financial companies. However, thanks to the emergence of the internet and decreased sanctions in the forex market, retail investors can now participate in the currency market from the comfort of their homes and offices.

In the past, if you wanted to make a trade in the forex market, you had to physically pick up the phone and call your broker with the details of the trade.

But brokerage firms quickly began taking advantage of the internet revolution by improving their services and accessibility by rolling out their own online forex trading platform which is a software that acts as a middle man between the investor at home and the brokerage firm. Not only do they eliminate the need to physically speak to someone, online forex trading platforms quickly evolved to include other value added services such as real-time updates, charting and research features, practice accounts, etc.

Before selecting an online forex trading platform, you need to ensure that you have access to uninterrupted broadband internet connection. This is important as you do not want to be frantically trying to make a trade with an unstable or slow connection, especially so if you’re interested in day trading.

You should also know that there are basically 2 kinds of online forex trading platforms, one that you download to your workstation and another that is run entirely from logging in to an account on the web. The advantage of the former is that the only online communication between your computer and the broker are real-time updates, research and charting information, as well as trading data. If you’re not confident of your internet connectivity or have a slow connection, you might want to consider a forex trading platform that uses this architecture. The advantage of the latter is that you’ll be able to access your trading account using any computer with an internet connection and not just a fixed one with pre-installed software. Useful if you travel often or if you simply want to trade from your home and your workplace.

Safety / Reputation of the Broker

You’ll want to ensure that the brokerage firm is reputable and have been in the business for a while as you’re entrusting them with your trades and hard earned money. Because you’re trading online, the forex trading platform should use the latest SSL encryption technologies.

Ease of Use

All good online forex trading platforms should have an intuitive user interface that doesn’t leave you scratching your head whenever you’re looking for a particular tool or feature. You should be able to execute orders easily with minimal mouse clicks. Because this is subjective, you might want to sign up for a trial account before committing any of your funds.

Practice account

The online forex trading platform that you want should definitely allow you to open a practice account for virtual trading. This is sometimes known as a dummy, demo or trial account. The practice account should have most of the features of the full account as this is the only way you are able to try out different strategies and get a feel of live trading without actually using any real money.

Forex mini account

A forex mini account should be your first step to real trading. Different forex trading platforms have different minimum deposits, ranging from $50 to $300 or more.

Charting tools and other resources

A good online forex trading platform should have charting tools for technical analysis, continuous real-time quotes 24/7, daily outlook and information on at least 16 currency pairs. You should be able to view your account easily, such as trading history, outstanding capital, etc. You should also be as easy as possible to make a risk management order as you generally do not want to trade without doing them.

Support and Community

Because the currency market is open 6 days a week with trading opportunities available day and night, a reputable online forex trading platform should have a helpdesk of support staff ready for any technical emergencies 24/7. Many good platforms also have a community of traders sharing their experiences in user forums which is a good for sharing of experiences within a specific trading platform and also making you less lonely while doing your research or trades. Developing a community can also be seen as a commitment of the broker to offer the best services available as it is easy for a disgruntled trader to influence the rest of the herd by posting negative comments.

Ability to trade through the phone

You might want consider trading platforms with this feature if you’re not a confident internet user or if you want a fallback to a dodgy internet connection.

Low spreads

Low spreads means more potential profits. Some platforms such as Forex Yard fix their spreads which is great especially in these volatile times.

Leverage and minimum deposit

Each online forex trading platform will offer their own leverages and minimum deposit although we caution against using high leverages without the appropriate risk management.

Commissions

Most forex trading platforms are commission free and the brokers usually earn from investors through the spread, but there’s no harm checking if they charge a commission per trade just in case.

Deposit method

Most brokers require that you pay your initial deposit through bank transfer, which typically means you’ll have to wait a while before making your first trade. This is fine as you can make use of the time to practice using a demo account. However if you are the impatient sort or simply want to trade using an automated forex system, then we recommend that you look out for a forex trading platform that accepts credit cards.

Robot Friendly

Finally, we strongly recommend that the online forex trading platform that you choose be robot friendly, just in case you decide to use an automated forex trading software in future. There have been reports of forex trading platforms that reject robots such as Fapturbo because of their high success rate. Generally, if the online forex trading platform supports the MetaTrader 4 forex trading software, you should be fine.

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Over the next 6 days you're going to Discover the World of Foreign Exchange Trading and How It Can Change Your Life...But Only IF You Take Action NOW!

Here's a brief description of what you'll discover in my Free 6 Part Forex Mini Course... forex 6 part mini-course cover

Part 1: What is the Foreign Exchange Market, Basics of Forex Trading, How Do you Calculate Profit and Loss, etc

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Part 3: Fundamental Analysis, The Best Time to Trade and The Worst Day of the Week to Trade (no, it isn't the weekends!)

Part 4: 2 Commonly Used Technical Analysis Strategies

Part 5: Understanding Charts, Gaps and 4 Trend Reversal Patterns

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If you're keen on exploring an automated forex software, I highly recommend Forex MegaDroid. Launched in 31st March 2009, it has already signed up tens of thousands of users and has a high 95% success rate.