There is a great variety of forex trading platforms and choosing the one is not an easy task. You have to consider a number of factors before diving into markets, especially when you are a beginner.
In this article I will try to reveal the most well known trading platforms and what are their main characteristics, so you can choose the one that suits your trading style.
Guest post by Peter Traychev of Forexbrokerz
Without any doubt the most popular platform is MetaTrader4. It is quite easy to use and yet has powerful tools suitable for advanced traders. Because MT4 is so popular and widely used we can divide trading platforms types into MT4 and non MT4 platforms.
MetaTrader 4 and 5
Many traders do not want to hear about any platform but MT4. It is widely spread over the world and the main reason is that it is simple to use and also stable. This software is provided by a Russian company based in Cyprus which is called MetaQuotes™. Apart from MT4 the company develops additional plug-ins, both client and broker wise which further facilitate the trading process. On e of the biggest advantage of MT4 is that it has API and traders can implement their automated trading strategies, a.k.a Expert advisors. The program language used by MT4 is MQL4. As a trader you may ask a technical person to write and compile your trading strategy so it can be automatically executed on the MT4 terminal.
MetaQuotes™ also launched its MT5 version back in 2010. The layout of the software is quite the same but some rules have changed and maybe that is the reason why this software has not yet penetrated the market as MT4 did quite successfully. Anyway, there is a plenty of time for the market to evolve.
Multiterminal
The Multiterminal facility is a completely different piece of software which serves money managers in their daily activities in managing multiple accounts. Instead of logging in each account and manually placing a trade, money managers are given the opportunity to quickly and efficiently monitor their accounts and execute trades on a scale. Although Multiterminal allows managing multiple accounts, there are issues connected to the regulatory environment regarding managing clients account. Either as a client or money manager, you should be advised that this activity is illegal if the proper license is not issued to the person managing accounts. Of course, this applies only to certain countries. However, it is a fragile issue and you should pay attention before having problems. From a technical point of view, it is important to note that Expert Advisors (EAs) cannot be run on Multiterminal.
Non-MetaTrader Platforms
One of the most well known non-MT4 platforms is Currenex. It creates an ECN trading environment which is considered to be a transparent and fair trading environment because of the lack of conflict of interest between clients and brokers. In the ECN trading pool there are many participants listed in a queue according to their offers. Both buyers and sellers meet in an order book. The best BID and ASK offer popup on top of the book thus forming the difference between BID and ASK price, a.k.a spread. This platform is suitable for traders operating with large volumes due to the fact that ECN trading is most cost effective type of trading (in most of the cases) in terms of trading costs. For example, the most traded currency pair EUR/USD can have a spread narrowed down to 0.4 pips. Of course it varies all the time and additional costs such as commissions may also arise.
The rest of the platforms are usually custom developed platforms by the brokers. Some are true gems but others can create confusion due to the fact that they are not commonly used and lack some features. You should be careful when choosing a forex trading platform because this is your main tool when trading the markets. Imagine Michael Schumacher driving a small Opel Astra instead of its Ferarri (no offense Opel) J. So the final conclusion is that the forex trading platform must fit your trading style and psychology. Whichever platform you feel certain with, just trade with it.