If you understand online trading, you know that your trading platform greatly affects your success. CFDs (Contract for Differences) are no exception.
The platform you choose is crucial because it gives you the necessary tools you need to trade, ranging from the charts, to real-time prices and quotes, and even the entry and exit interface for the market.
You therefore need to be very careful about which platform you choose.
CFD trading involves speculating the prices of the global financial markets (Indices, currencies shares, and commodities) e.g., if the prices will rise or fall, then going long (buy) or short (sell) to make a profit.
Being a beginner in trading, choosing between the vast numbers of Forex trading platforms in the market can be challenging.
Therefore, below we have outlined a few factors you can look out for to determine the best platform for your trading.
1. Your trading needs
It's common to see entry-level traders using platforms that don't serve their needs. This is mainly because of pressure from other successful traders.
However, you need to understand that not all platforms are right for you. While one may be working for your friend, it may not necessarily suit your needs.
Therefore, you should first determine what you want to trade and in which market. Secondly, identify a platform that offers good features based on what you wish to trade. Doing this will help you avoid overspending on some functionality that you won't use.
2. User interface and visual appeal
Believe it or not, the user interface of the platform you choose will affect your CFD trading. Different platforms have different interfaces, some of which you may not be comfortable with.
A good platform should be visually appealing, clear, and easy to navigate as well as be written in a language you understand. Tasks such as opening and closing orders, or opening charts should be easy in order to enable you to get the most of the market.
Moreover, a user-friendly platform allows you to analyze the market better and hence gives you more confidence when trading.
3. Reliability and Functionalities
Among other factors, this is the most important ones to consider when choosing between different CFD trading platforms.
You need to have a platform you can depend on. For this, look into the responsiveness of the platform and the features offered.
The platform you choose should be highly responsive to prevent you from being the victim of slippage. For instance, whenever you place a stop-loss order, in the event of a sudden high-volatility event, you'll incur a heavy loss.
Nonetheless, a highly responsive platform will stop the loss immediately, saving you from extensive loss.
Also, ensure that the platform you choose has all the features you were looking for. Features such as analysis tools, data security, and trading software are crucial.
Otherwise, you'll end up investing your money with the wrong platform.
4. Platform costs and fees
Different platforms charge different prices in terms of order commissions and broker services offered. Some platforms charge you based on the commission, while others based on the spread.
You therefore need to get these figures right before choosing any platform.
In CFD trading, some platforms also have some additional costs for account fees, software fees, etc. Find out these hidden fees beforehand as they will quickly eat down your profits!
5. Customer support
Finally, besides the fees, customer support services offered are very important.
This is because, while it's your job to do all the trading, the support team helps break down the sophisticated features offered by the platform.
You, therefore, get to understand how to use these features to your advantage and hence maximize your profits. Additionally, it's nice having someone to turn to whenever you encounter problems with the platform.
Conclusion
When choosing a CFD trading platform, you have to be very cautious when making decisions. All platforms don't work for everyone, and certainly, not for you.
You need to do your research and look into different platform's reliability, functionality, customer support, trading costs, and even user interface.
Most of all, you should ensure that the platform you choose fits with your CDF trading strategies and meets needs.
