For a lot of people, the notion of Forex trading might conjure up images of swarms of traders yelling excitedly across a crowded trading floor and making strange hand gestures, accompanied by the constant slamming of phones. For many years that was a reality of life as a professional trader, but the trading environment has changed.
The markets themselves are not fundamentally different, it’s just that technology has changed the way we trade. Nowadays a trading floor is a much calmer place, more likely to consist of rows of people sitting quietly in front of big banks of computer screens. And it’s not just professionals either. As recently as ten years ago, the average person on the street couldn’t just open up a trading account and tap into to the trading network – that was reserved for large institutions like banks and governments. Now things have been opened up to retail traders, effectively meaning anyone can trade from almost anywhere. All you need is a computer – or just a mobile device – and the right piece of software.
And there’s a lot of trading software available. Some are comprehensive platforms developed by big companies, others are little pieces of software created by a single trader designed to do just one specific task. The one thing all this software has in common is that it’s all been created to make life easier for traders. If fact, trading is so easy now that you don’t have to do anything at all – you can set up trading robots to do all your trading automatically.
You might reasonably ask why you’d hand over all your trade decisions to a computer when you have a perfectly good brain to keep track of what’s happening in the markets. After all, a piece of software is only as powerful as the coding that creates it whereas the human mind is flexible and can react and make decisions based on new, complex and changing information.
The difference is that software does what it does incredibly quickly and on a much greater scale. For example, while you’re sitting at your desk and peering at a screen trying to figure out whether or not to place a trade, a scripted program won’t hesitate. It uses data – and only data, with no emotion or ‘gut feelings’ – to make a binary trade decision, then it moves on to the next trade. Software can make an almost limitless number of trade actions in the time it takes a human to make just one.
The way you utilise trading software is really going to depend on what your goals are and how you want to meet them. Some traders are happy being very hands-off and letting a Money Manager or an EA (an Expert Advisor, or trading robot) do absolutely everything. Others enjoy having full control of every aspect of a trade. And others like to keep the majority of control but use extra bits of software just to make life a bit easier. Trading software is available for traders of every level and different purpose – for example some of it designed to be conservative in nature, some built for risk – so it’s up to you to decide what and how much of it you want to use.
Setting a good platform
If you’ve never traded before, how do you begin trying to navigate the world of trading software? The best way is to approach it like any other purchase: figure out what you want, do some research, then narrow down the options.
An excellent way to start is with a platform like MetaTrader 4 (MT4). This is the default platform offered by AxiTrader, and it is offered for good reason as it’s the world’s most popular trading platform. MT4 is proven software, created by a company called MetaQuotes which is a specialist in software development for financial markets. At even its most basic level, MT4 offers everything a trader needs, including real time pricing, access to all the major currency pairs and the ability to connect across devices. But it has also been built so that traders can add or develop custom add-ons.
Add ons and extras
In a way, a trading platform like MT4 is like a good basic car. It will comfortably get you from A to B and it has lots of really useful features, but there are plenty of extra bits and pieces you can add to make it better, more powerful or just change the way it looks.
While many traders can and do happily work with the standard platform, there are thousands of software extensions that can be added on to make the platform better suited to a specific task. This can be anything from advanced Trade Management Tools which let you have more in-depth analytics and reporting, through to Expert Advisors which let you trade with complete autonomy. In conjunction with those add-ons, additional services like a VPS will help these more sophisticated software programs tick along. Some of these add-ons are free, or free when you join a broker, while others come with a fee.
While there’s an abundance of trading software out there to explore, when choosing any software – especially software that’s been created by a lesser-known independent company or person – you need to do your due diligence before you commit to using it. With well-known programs like MT4 or programs offered by regulated brokers you can be pretty certain you’re in safe hands, but if you’re considering using software without such a high profile – especially those that make bold or potentially unrealistic claims about high trade returns – it always pays to try and verify any claims. You can do this by talking to other traders, reading reviews, even contacting the developer if you have questions – if the software is reputable they should be able to provide you with verified trade history. That said, you must also remember that past history is not a guarantee of future success.
Ultimately your situation, your strategy and the way you trade are all going to be slightly different to the next trader so the technology you choose may be different to the next trader and what works for one trader may not work for you. But with so much software now available, there is bound to be something that can help you and your trading – if you want it – but it’s always worth spending a bit of time doing your research and choosing something that’s going to best suit your needs.
The information provided here has been produced by third parties and does not reflect the opinion of AxiTrader. AxiTrader has reproduced the information without alteration or verification and does not represent that this material is accurate, current, or complete and it should not be relied upon as such. The Information is not to be construed as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product, or instrument; or to participate in any particular trading strategy. Readers should seek their own advice. Reproduction or redistribution of this information is not permitted.
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