A trading platform is not your usual broker who negotiates on a trader’s behalf with other buyers or sellers, rather it’s a software used for trading.
Since 1970, the transactions in the financial markets started to be handled by an electronic system instead of handling them by hand. At first, it’s begun as a tool for brokers. Over the years, that system has evolved into fully-fledged trading platforms.
By definition, a trading platform is a software that allows anyone with a trading account to perform all the trading and investing related activities via one or more financial intermediaries. Thanks to the advancement of technology and the availability of the internet, it is now the go-to option for most investors.
With the inclusion of advanced algorithms and automation, an online trading platform can effortlessly showcase the real-time quotations and execute an order in no time. As physical location became somewhat irrelevant because of the internet, these platforms can also enable traders to buy, hold, and sell a great variety of securities from all over the world.
So, today, we discuss what makes a trading platform better than the others below.
Legitimacy and Reliability
To regulate the influx of online trading platforms, countries and unions have set up some regulatory bodies. It includes authoritative bodies like CySEC in Cyprus, ASIC in Australia, FCA in the United Kingdom, etc. Not only these bodies are responsible for the registration and authorization of online stockbrokers, but also they can be a guarantor for the money deposited into your trading account.
Therefore, it goes without saying that the fundamental requirements for a trading platform are to have validity from one or more of these regulators. The best ones usually tend to comply with multiple financial authorities. Moreover, you should also consider the reputation and the reliability of the services offered by any particular online stockbroker or platform.
Requirements and Fees
Different platforms require investors to fulfill a set of different criteria to be able to use their services. It may include a proof of identity, proof of address, a minimum amount to deposit, etc. Some brokers may also charge you a fee in order to just open and maintain an account with them.
However, the best trading platform is the one that makes it as easy as it’s possible for the investors to open, close, and manage both their accounts and their positions on a particular asset. The best ones also offer all or most of their services for little to no fees at all.
Features and Available Assets
Offering just the basic services isn’t enough anymore for the best platforms. They also should offer a host of useful features like charting tools, news feeds, premium research, in-depth tutorials, etc. The availability of different securities such as stocks, bonds, ETFs, indices, commodities, currencies, cryptocurrencies, etc. are the other factors for a great experience. The best trading platform should also be accessible through any internet-enabled devices like smartphones, tablets, and computers.