How to Choose the Right Trading Platform for Yourself?
Whether you are completely new to the idea of investing or are a seasoned trader, finding a trading platform that fits your needs well is important.
The key to success is in finding a trading platform that you can navigate easily and offers you a range of trading tools that make it simple for you to analyse the markets and make the best investment decisions.
If you want to diversify your portfolio by trading multiple different assets, you will need to find a trading platform that provides several different options.
You’ll also need to consider certain individual non-trading needs when choosing which trading platform to go with.
For example, if you plan to do a lot of trading on the go, you will need to make sure that you have signed up to a good mobile trading platform that works seamlessly with the desktop option.
And, to help you make the best trading decisions, it’s important to find a platform that allows you to track the historical movements of each tradable asset available. You will also need to consider the type of trading tools that you want to use, such as technical analysis.
We’ve put together a handy guide to help you choose the right trading platform for you.
Make the decision individually – don’t follow the crowd
One of the worst mistakes that you can make as a trader is to simply follow the crowd and make your trading platform decision based on what others are doing rather than by considering what you actually need for yourself.
Bear in mind that even if you have family, friends, or colleagues that are trading, just because a certain trading platform works well for them, does not mean that it is also going to be the right option for you.
Always do your own research to shortlist platforms that appear to meet your needs and open a demo account that will allow you to try the platform out for yourself and make sure that the features are what you expected.
To help you get started with choosing the right trading platform for you, use Wealthsimple’s reviews of the best trading platforms, Canada.
Wealthsimple compares various trading platforms that have a good reputation to help you figure out which one is most aligned with your needs. Additionally, they offer a range of tips and tricks to help you get started with investing if you are new to the scene.
Consider the device you’ll be using
The device that you plan to make most of your trades from is an important consideration when choosing your trading platform.
The good news is that the majority of trading platforms will provide both a desktop and mobile version to use today.
Consider whether you are going to spend most of your time trading from your desktop or laptop PC or whether you need an option that is ideal to use on the go. If you are on the move all the time, a platform that needs to be downloaded to a laptop or PC can become cumbersome and hold you back.
On the other hand, an online trading platform or a trading app that’s designed to easily be used from your smartphone will be the better option for you.
Generally, good mobile trading platforms offer all the same functionalities as the desktop platform, but it’s always best to try them out with a demo account to ensure that this is the case before you start trading any real money.
The range of securities available
Many wise investors decide to diversify their trading and investment portfolio by trading multiple securities. If you would like to do this, then it’s a wise idea to first check that you are choosing a platform that will provide you with access to a range of different assets.
You will want to have access to various different assets classes if you are planning to trade moving securities such as stocks, indices, currency pairs, cryptocurrencies and commodities.
On the other hand, if you are only looking to trade one security or commodity, it may be a better option to consider looking for a platform that specialises in this and can therefore offer you a more tailored experience.
If you are new to trading and want to start off by trading one security but plan to diversify your investments in the future, a platform that offers a range of securities will allow you to easily grow your investment portfolio over time as your skills and experience grow.
Technical features and investment options available are not the only important things to look for when choosing the right trading platform for you.
It’s also important to think about how well the platform performs in terms of the user interface. A user interface that is cumbersome and not well-designed can easily become a big problem for you and can even end up affecting your investments.
If you’re struggling with the user interface, your risk of making mistakes will increase and you’re going to find it difficult to make investments quickly and choose the right ones.
Because of this, it’s important to ensure that you choose a platform that is user-friendly and designed to make complicated jobs as simple as possible for you.
Variety of trading tools
Trading platforms offer a diverse range of helpful trading tools that are designed to help you best execute trades and get the most from your investments.
There are various different tools available and the ones that you need will depend on how you plan to trade and what you are considering trading.
Some key tools to look out for are designed to help you analyse the capital markets. These include an education portal, economic calendar, and charts.
An economic calendar allows you to track any future monetary and economic policy releases that can cause changes to the movements of capital markets.
Many economic calendars provide information on prior releases and an estimate of the release. Charts tools allow you to perform a technical analysis; this involves studying past price actions to make it easier for you to predict an asset’s future movements.
And finally, a well-stocked education portal is essential if you are new to trading or have some experience but want to learn about different risk management techniques or trading strategies that will help you get better results.
A good reputation
While it’s important not to choose a platform based solely on what others are saying about it, you’d be wise to make sure that the platforms you have shortlisted are enjoying a good reputation.
Once you have done some research and come up with suitable potential platforms for you to trade on, check the reviews and see what others experiences are like using this platform.
You can use general review sites like Trustpilot or post a question on a site like Quora to directly ask other traders what they think about the platform and what their experience has been like so far.
Don’t underestimate the power of word-of-mouth marketing. If a trading platform is as good as their website says it is, asking for reviews from the community of traders who have real-life experiences with it will only confirm this.
Demo account option
Once you have had the chance to research some platforms and get a feel for what other users think of them, it’s time to try the platforms out for yourself.
Most good trading platforms will offer a demo account that allows you to try all the features out before you commit to investing any real money.
In fact, a trading platform that does not allow you the option to set up a demo account and ‘try before you buy’ is usually best avoided since there is no way of finding out what the platform is going to be like without the huge risk of losing your initial investment, which is only worth taking once you understand how the platform works and you are comfortable with using it.
A demo account allows you to trade with demo money rather than your actual, real capital and allows you to test the trading platform to make sure that it’s the right fit for you and ensure that you know what you are doing when you finally execute a real trade.
And, a demo account can be a great tool to use, not just as the beginning of signing up to the platform, but also in the future if you would like to test out or practice new trading strategies and determine how they are likely to perform in real-time.
Look for a platform that offers a demo account that accurately reflects how you are going to use the platform in the future – on desktop or mobile.
Trading is an increasingly common investment opportunity with various platforms available for trading a wide range of securities and commodities.
Before choosing a platform, it’s important to consider the assets available to trade, the tools that they provide, interface, reputation, demo account options, mobile access and more, to ensure that the platform fits your needs.