Trading Platforms

A trading platform is defined as a software application, traditionally run on a computer or smartphone that allows the trading of financial instruments and securities.

This can include currencies, stocks, indices, and commodities, among others.

Speculators and investors are able to view charts of their instrument of choice, and buy, sell and manage their trades using an online trading platform.

Since the advent of the Internet in the 1990’s, and more powerful home computing in the 2000’s, the use of retail trading platforms has become very popular in recent years.

This in turn has led to the proliferation of retail trading as brokers have made this form of investing available to ordinary individuals.

Traders are now able to open and close trades in literally milliseconds, a stark contrast to telephone-based trading in recent decades.

Online trading platforms have also given birth to automated trading. No longer does a trader need to monitor their charts before manually placing a trade.

One can now merely develop a software to follow a specific trading system’s rules, and the software, (often called a trading robot), will execute trades and manage positions autonomously.

In theory this can eliminate a trader missing a setup or opportunity to enter whilst asleep or unavailable.

This is instrumental when trading certain assets such as FX, which is a 24/5 market.

Retail Traders Benefitting from Trading Platform Advances

Generally speaking, a trading platform is offered by banks or brokers to traders. The most prominent trading platform includes MetaTrader 4 (MT4) and MetaTrader 5 (MT5).

In addition, trading platforms are now no longer limited to computers. In recent years smartphones have allowed the trader to install basic versions of their desktop counterparts, in the form of trading apps, such as for iOS or Android.

The advantage of trading platforms is also its disadvantage.

The fact that almost anyone can get into online trading, means that a lot of traders are indulging in financial markets extremely unprepared, hence suffering significant financial losses.