Top Tips for Choosing a Trading Platform
Are you new to trading? Choosing a trading platform is one of the first steps you’ll take. In fact, signing up for a platform is essential for anyone looking to dip their toes into the world of trading and investing.
But there are many platforms available, each offering a range of attractive features and benefits. This means it can be overwhelming to decide which is the best fit.
However, with a bit of research and understanding of your own needs, selecting the perfect trading platform becomes much easier. Here are some top tips to help you whittle down your options.
What is a trading platform?
Before you start researching your options, it’s good to know what a trading platform is and the role it plays. Its primary role is to act as the gateway to financial instruments such as stocks, bonds, currencies (forex) and commodities. This digital hub allows investors to buy and sell across the different markets and access real-time market data. They can also place trades, manage their portfolios, and analyse investment opportunities.
These platforms come in various forms, from simple web-based interfaces to sophisticated software with advanced charting tools and technical analysis capabilities.
Decide what’s right for you
To find the right platform, assess your needs and preferences. Here are some key questions to consider:
1. What costs are you prepared to pay?
Different platforms have varying fee structures, including commissions per trade, spreads, and account maintenance fees. Some also include inactivity charges for when traders allow their account to go dormant. Calculate how these fees might impact your returns, especially if you plan to make frequent trades.
2. What do you need the platform to do?
Work out what your trading strategy is. Are you focusing on stocks, or do you plan to diversify into forex, commodities, or cryptocurrencies?
Once you know what you want to trade, you can check that the platform supports the asset classes you’re interested in. Platforms like Tradu offer access to all the major markets, but it’s important you check that you can trade the instrument you have in mind before you dive in.
3. What’s the minimum deposit?
Some platforms require a minimum deposit to open an account. Make sure the platform’s minimum deposit fits with your budget and investment goals.
4. How user-friendly is the platform?
Consider your level of experience. As a beginner, you might prefer a straightforward, intuitive interface with educational resources and customer support. Advanced traders are more likely to prioritise robust charting tools and technical indicators.
Look for trusted brands
With a clearer understanding of your requirements, it’s time to explore some reputable trading platforms. Look out for key features such as whether there’s a demo area, how accessible the site is and whether the educational resources are readily available.
As with anything, there might be some trial and error involved. You might find the perfect platform right away or you might discover that you prefer your third option. Also, as you become more confident as a trader, you might opt to switch to a more advanced platform.
