Forex Trading Platforms

Choosing From Forex Trading Platforms

One of the first decisions that new traders have to make is choosing a platform to work on out of the wide range of forex trading platforms out there.

Forex trading platforms can be instrumental in determining the success of a trader and although the distinctions between individual forex trading platforms can be subtle, they can be incredibly important.

There are several considerations that traders must take into account when choosing amongst forex trading platforms such as ease of use, extra features, ability to integrate custom indicators, the trading functionality of the platform and also price feed.

Let’s consider the pros and cons of the three most popular forex platforms; MT4, Ninja Trader and Trade Station. and consider the pros and con

MT4

Metatrader 4 is by far the most popular of the forex platforms for new traders. First and foremost, the platform is free and is also incredibly simple to use.

The platform was first introduced as a piece of internal software for brokers to use to process client orders before being opened up to the public as internet trading began to take off.  The platform is incredibly simple to use and has a range of great features such as a list of inbuilt tools and indicators ready for use.

The platform also features an expert advisor function which allows traders to load automatic trading programs which execute trades on a pre-determined basis.

As well as the list of inbuilt tools the platform also features an editor function which allows traders to build custom indicators and/or custom Expert Advisors.

In terms of testing out strategies, MT4 also provides a back testing functionality where traders can reply historic data and establish how indicators and/or strategies would have performed either by manually applying their strategies or running automated programs.

When it comes to trading functionality the suite provides a range of options rom market execution through to pending orders.

However, most of the criticism around mt4 is tied to execution issues. Instant execution provides the advantage of giving the trader a known price to execute at however, during times of high volatility price can significantly shift and the requested price cannot be filled, this can sometimes lead to a trade being filled at a sizeable disadvantage to the trader’s original requested price.

As mt4 only shows top of book pricing displayed as a single price, traders do not have knowledge of the underlying liquidity (depth of market) which can create a disadvantage when looking to execute.

Another problem also cited is to do with the quality of historical data on mt4 which can often lead to unrealistic back testing results

Understanding Forex Trading Platforms

 


 

Ninja Trader

Ninja Trader is one of the more advanced Forex trading platforms and whilst the actual software is free of charge you do need to pay to connect to a data feed.

The platform features all of the same functionality as MT4 as well as a huge array of add-ons such as an increased variety of charting types such as renko, point and figure, range bars and more. The platform also supports futures trading.

The benefits of connecting to a private data feed include access to a variety of providers as well as visibility of the depth of markets so traders can establish available liquidity at desired prices.

The platform is accordingly more complicated than MT4 and a lot of setting up and configuring is required, however, Ninja Trader have superb technical support and are always happy to help, in addition to this there is an abundance of tutorials concerning the correct setting up and usage of the Ninja Trader platform.

In all, the additional functionality of Ninja Trader makes it a favourite of more advanced traders who are ready to move on from MT4 but it take a little time to get used to the different aesthetic feel of the platform.

 

Choosing Forex Platforms

 

 

 

 

 

 

 

 

 

 

 

Trade Station

Similar to Ninja Trader, Trade Station can be considered a more advanced platform than MT4 where traders once again benefit from an increased range of third party add on.

Custom editing and back-testing capabilities once again make this a great platform for any traders looking to implement automatic trading systems as well as access to one of the industry’s most extensive historical databased which covers not just intraday data but also over 1000 fundamental data fields.

Drawbacks to the platform are linked to pricing as no demo mode is offered and also, Trade Stations is far more expensive than its competitors as so is generally only an option for wealthier or more experienced traders.

Forex Trading Platforms

 

 

 

 

 

 

 

 

 

 

 

 

 

As you can see, there are clear benefits and drawbacks to each of the forex trading platforms and typically, your best bet is simply to go and try them out and see which one you prefer. Obviously with Trade Station however this isn’t possible so generally we find the majority of new traders cutting their teeth on MT4 or Ninja Trader.

If you’re just starting off with Forex, take a look at our Forex for Beginners post; you might learn something interesting!