Trading Software Platforms: What to Consider
So first off, this isn’t aimed at the experienced traders out there. It’s more for those that are relatively new to the world of trading and aren’t entirely sure on what to initially consider and expect when dealing with trading software platforms.
When starting out, you quickly reach a point where there’s a serious case of information overload, and deciding on what trading software to use definitely doesn’t help matters.
You’ve no doubt read books that reference these platforms, and some may have even recommended which ones to use, but as with most things when trading, it all comes down to what you personally require for your specific style of trading.
So, what are the main things you actually need to consider?
Price
Fairly obvious I know, but when you’re starting out and aren’t entirely sure you’re going to be able to make money from trading/spread betting you don’t exactly want to be paying out large amounts and getting tied into 12 month contracts for trading software. Most providers offer tiered packages ranging in price, or there’s even free options out there if you only need EOD (End of Day) data. You need to be careful that you don’t end up paying for something that includes features that you will never actually end up using.
Trading style and data requirement
By this I don’t mean are you a Swing, Trend or Sentiment trader, it’s more about looking at what type of trader you want to be and then understanding the data requirements needed within your trading software. Do you plan on Day Trading and sitting in front of your screen wanting to see a live feed of all the action? Then you’ll need Level 1 data included in your package. If you want to see all the detail behind the scenes and what orders are being placed and at what price, then you should look at Level 2. But you get the idea, look at what your trading style requires before signing up for the top level of everything when you might not even need it.
Your experience level
Having too many options without any real understanding is dangerous. Believe it or not, the experienced traders I’ve spoken to actually use fewer indicators, and less complex systems the more they’ve developed their trading strategy. When you search you’ll no doubt come across trading platforms referring to enhanced charting tools, over 100 technical indicators, custom scripting etc, but if you’re not experienced enough to understand or use them then what’s the point in paying a premium for them?
Technical vs Fundamental
Does your trading style rely more on technical analysis or fundamental? Or is it quite an even balance between the two? If, like myself, you’re more of a chartist then you need to ensure that you choose a platform that allows you to customize, overlay multiple indicators on the same chart etc. There are a few free trading software platforms out there such as Pro Real Time that allow you to do that. But if you focus heavily on the fundamentals then that’s usually where you have to pay a little more to get access to the information.
Ease of use and Functionality
This is more important than you might think, especially when first starting out. Platforms do allow you to customize your views so you can limit what is actually displayed, but that’s only after spending the time to find your way around the numerous menus. For me it’s the simple things like a clean, minimalistic design/ layout and keyboard short cuts to add stocks to watch lists etc. Definitely have a play about on a few demo versions before you commit.
Accessibility
This is quite a new one, but something that’s only set to get more and more relevant. If you plan on spending most of your time sat at home in front of your screen Day Trading then it might not be that high up on your priority list, but for myself who actually enjoys the job I do, and people who travel a fair bit it will be more important.
Basically it splits platforms in to two camps. The traditional ones that you install on your computer, and those that are web browser based (Internet Explorer, Chrome, Safari etc) Obviously the ones that require you to install the software directly onto your computer can then only be used on that machine/ device. But those that are browser/ cloud based can be used on any laptop/ PC that has access to the Internet.
Both have their pros and cons, but for me the flexibility of being able to trade from any device is a massive plus.
Choosing the right one for you
Again, it all depends on what your style of trading is, and hopefully by asking yourself a few questions based around the above you’ll have more of an idea as to which one will suit you best.
The two that I have personally used are Sharescope and Pro Real Time. Sharescope is a subscription service, which has Gold (£18 a month), Plus (£36) and Pro (£95) packages. Prices might have changed mind you. It’s a downloadable application which you have to install on your computer (there isn’t a web-based version). For older computers it can be quite resource intensive, so be sure to check out the system requirements before you purchase.
My favourite part of Sharescope is the excellent data mining facility. You can set up filters which consist of criteria a company must meet in order to be displayed. For example, I have a dividend filter which requires that a company yields 3.5% or more with a dividend cover of 2 or more. Each day as part of a routine I run the filters I’ve set up and look for companies which I then consider as trading or investment candidates.
Sharescope was the first package I used, and like most providers out there they offer different package levels based on what you’re after. Being a beginner at time I opted for the most basic Sharescope Gold (due to only needing EOD data) which I found to be really easy to use with a ridiculous amount of features, especially for an entry level product.
But then one faithful day I made the decision to purchase a Macbook Air, which I have no regrets about in the slightest, the only issue was that Sharescope doesn’t work directly on the Apple operating system and requires additional software packages and Windows to work.
Which was when I looked around and came across Pro Real Time, which I currently use and am very happy with and has everything I need, and best of all it’s free for the basic version. Winning!
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