The first thing that is required to be done when someone is considering trading forex is to set up an account with a forex brokerage. This is a fairly straightforward process commonly completed online. The currency or forex market is a huge market with billions of dollars traded every day and so as you would expect there is a lot of competition amongst brokers when it comes to trying to sign up new clients or tempt clients to switch brokers. The main selling points that will attract new business for an online broker is their costs, support and the software they use to trade with.
A trading platform is the software specifically used by a trader, it is effectively an interface that delivers information and allows the trader to carry out trades. When assessing different platforms a new trader should make sure that any possibilities have adequate security measures protecting the trading account and trades.
Another valuable feature is the ability to stream real time data for the client to see (admittedly this applies more to stocks and commodities which trade on an actual exchange). Another important attribute of any trading platform is that it needs to have a helpfully clean layout where the information is easy to read and comprehend. As well as requiring a straightforward process to actually place a trade, a platform should also display the real time profit or loss of each trade so the user can take immediate action when required.
As well as all of the primary functions, decent software should allow a user to place and edit stop losses speedily and easily whether they are fixed or moving. Another feature of a good trading platform is the charting software which gives clients the facility to pull up the chart on specific currencies and manipulate the time period so that they can perform adequate technical analysis prior to entering a trade or indeed whilst monitoring a trade. Charts should be able to be configured to intra-day readings, to a minute and hour scale or expanded out to chart the last 3 months, 1 year, 5 years, 10 years etc. Multiple trades should be able to be performed and the platform should show clearly the trading balance on the clients account along with the margin (or leverage) being used.
Trading platforms generally come in 2 different forms, the generic platform that is used by multiple brokers. The most prevalent example is MetaTrader 4. The other type of software is one built and maintained by the online broker themselves. Many of the makers of additional forex trading programs such as forex robots and chart indicator packages will have designed their products to work straight out of the box on generic platforms whereas there could be compatibility issues with in-house software. Things are improving however with less and less problems occurring with add on products and dedicated trading platforms.
Something to be aware of are the new account incentives being marketed by brokerages. With these offers you can typically get a match to your initial deposit capped at anything between $25 up to and over $10,000. Caution is advised and read the fine print carefully as usually these bonuses are linked to the number and size of your trades.
Probably a wise move would be to download a demo version of the platform. This is more to do with analysing how the platform works and performs rather than trading fake money. Once a platform is found that exceeds all of the above criteria it is time to open up a live account.