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Forex trading platforms are tools through which traders can make trades in forex and CFDs. A good forex platform is able to improve the efficiency of investment, so it is worth knowing what this tool should be characterized by and take some time to choose the best one.
Forex trading platforms – what is it?
A forex trading platform is a professional application with the help of which a trader has the opportunity to make transactions in the currency and commodity markets. This term is often confused by novice investors with brokers, who are intermediaries and provide trading platforms.
In addition to making orders, forex platforms often have a number of additional functions, and are great for making technical analysis.
Features of a good forex trading platform
There are many different trading platforms available on the market, and especially novice traders have trouble choosing the right one. To choose the best one for you, it is worth paying attention to several issues.
Intuitive and simple interface
Most novice investors, seeing a trading platform for the first time, feel perplexed. The many different functions, options and tabs make the trader not know where to start. For this reason, it is extremely important that a forex trading platform is simple, easy to read and has a user-friendly interface. Before deciding on the platform of choice, a trader should test at least a few of them.
Most people are fluent in English, but there are some who may have trouble with it. Therefore, it is advisable to make sure beforehand that the chosen platform has a Polish language version. This will certainly be helpful in day-to-day work.
This is another aspect worth paying attention to. Nowadays, almost everyone uses a mobile device, such as a smartphone or tablet. It is worth checking whether the forex trading platform of choice is available in the form of a mobile app for mobile devices. This allows the trader to have his investments under control and make trades from anywhere in the world (read also: World stock exchanges).
Useful analytical tools
Advanced analytical tools, such as access to daily economic information, are sure to benefit making investments (read: Forex investments). Professionals cannot imagine working without such analytical tools. Therefore, it is worth choosing such an investment platform that offers useful features, including the world-famous Meta Trader 4.
When it comes down to it, this is with more experienced traders in mind. Most software has extended reports, but you have to look for them in the application settings. This allows the trader to analyze the market in detail, which will surely translate into better investment returns. If a trader is interested in the best forex platform, it will certainly be one that has extensive reports.
Wide availability of markets
Professionals are well aware that in order to reduce the risk of losing capital, it is necessary to ensure proper diversification of the investment portfolio. Investing should not be based on buying a single financial instrument, so when deciding which investment platform to choose, pay attention to the markets available on it.
In addition to currency market instruments, forex trading platforms sometimes provide CFDs.
The tools allow you to invest in CFDs on stocks, indices or the increasingly popular cryptocurrencies (read also: How to invest in cryptocurrencies). For investors looking to diversify their investment portfolio, platforms that provide access to the broad OTC market may be the right choice.
Speed and reliability
Sometimes decisions in the forex market need to be made at lightning speed. That is why it is so important to guarantee that the platform will work reliably and quickly. It is very often the case that success or failure, in particular, is determined by making good decisions without delays from the operation of the investment platform.
An important parameter that determines the choice of a particular platform can also be the availability of order types – from instant, to pending orders, and whether they offer the possibility to place and modify these types of orders straight from the charts.
Free additional features
Access to a forex platform these days should be free. A good forex broker should offer its services free of charge. Whether you’re talking about tools that are used for trading, commentary or analysis, as well as education, it should all be in one package for every user.
In addition to the mere security of funds at the selected broker, it is also worth paying attention to whether the platform is emergency. If so, it is easy to imagine a situation when a trader needs to make a transaction and the platform is out of order. It is advisable to choose such a broker and Forex platform, which are already well established in the financial market and many people have used their services (read also: Investing in the forex exchange).
Costs and fees
Trading fees are imposed when buying and selling currency pairs. Some platforms impose both commissions and spreads on transactions. Other providers offer investment accounts with different pricing models.
For example, one account may offer access to zero spreads, but you will have to pay a fixed commission. Other accounts, on the other hand, allow you to trade without commissions and have less competitive spreads.
The best forex trading platforms
The best trading platform should be reliable, fast, easy to use and always have up-to-date data as well as necessary features and tools. Below is a list of Forex platforms that are worthy of your attention.
Meta Trader 4
This forex trading platform has been on the market for many years and is very popular among traders. It is among the most widely used platforms of the foreign exchange market.
The Meta Trader 4 platform convinces not only professionals, but also inexperienced people, because it is clear, easy to use and intuitive. It does not have a number of heavily advanced features, and focuses mainly on the basic tools at hand. This forex trading platform has also gained popularity because it uses the simple MQL programming language and anyone can write a trading machine. There are a lot of them on the web, which many say is designed to either streamline or automate the decision-making process.
Forex platform xStation 5
Another popular forex trading platform is xStation. Its first version was created in 2011 by X-Trader Brokers, which is very popular among users. It is a modern trading platform that has been awarded many times.
The platform offers users access to market analysis, extensive technical analysis, a macroeconomic calendar, commentary and statistics. Moreover, it has an extensive advanced scanner of ETFs and stocks. Thanks to this, in a matter of seconds, taking into account popular parameters, the investor is able to filter many available stocks.
The xStation platform is available in 3 forms. As a web version for the computer, for review and a mobile application. It is an innovative platform that on many advanced features, as well as window layouts with a huge space for personalization, so the user can customize it according to his needs.
Alior forex platform
This is Alior Bank’s forex platform, which is a fully customizable software and can be easily customized. The many possibilities are sure to meet the expectations of demanding customers as well. The application is owned by the bank, so trading is regulated by the Financial Supervisory Commission.
mBank forex platform
The platform is based on Meta Trader 4, but it is more extensive, but still simple to use, so it meets the needs and expectations of traders even better.
Which forex platform for beginners?
For most traders, until recently, the Meta Trader 4 forex platform was certainly appealing. Not surprisingly, it’s a tool that’s hard to get right. However, regulations came into force that limited leverage, so proprietary forex trading platforms began to play a big role (read also: Margin trading and leverage). They have a certain advantage, which is the broker’s constant ability to improve them, tailoring them as much as possible to the needs of users. An example is the xStation platform, which is constantly being updated.
When making a final decision on which forex platform to choose, a trader should take into account what financial instruments he intends to use. For beginners, the best choice will be that trading platform that offers a wide educational section on the one hand, and an easy-to-use platform on the other.
The best forex broker
Forex trading platforms are provided by intermediaries, or brokers. The ability to choose the right one is very important, as some brokers do not charge commissions, and the margin is included in the spreads. Others, on the other hand, do the opposite – they offer actual prices with trading commissions.
This is a globally popular broker with more than 25 million users. It offers access to the foreign exchange market using a website and a mobile app that runs on Android and iOS. The broker offers about 50 currency pairs from various markets, including less popular ones. The trader can buy and sell currency pairs using leverage. Typically, leverage limits on major currency pairs are 1:30, and on exotic and small currency pairs are 1:20. This forex broker does not charge commissions on currency market trading, and spreads on the EUR/USD currency pair start at 1 pip (read: Forex currency trading).
An account on eToro can be created with 10 euros. Funds are deposited using an e-wallet, credit or debit card, bank transfer or ACH. This broker does not charge fees for payments made in USD for deposits as well as withdrawals. As for other currencies, it charges a withdrawal and deposit fee of 0.5% per transaction.
This forex broker offers real-time charts, as well as technical analysis tools.
A trader can use a demo account with 100,000 euros of virtual money (read also: Forex demo). Copy trading, on the other hand, allows you to copy the trades of experienced traders. This can be done on the basis of extensive data, which allows you to choose the right trader to copy.
In addition to Forex, the trader gets access to commodities and indices, as well as many stocks and ETFs (read also: Exchange-Traded Funds). With the help of this broker, one can also invest in cryptocurrencies at a commission of 1%.
With this broker you can trade on currency pairs using CFDs. It offers derivatives that are based on the prices of cryptocurrencies, currencies (read: How to invest in currencies online), indices, stocks and commodities. It offers more than 450 tradable assets.
When opening an account, there are 4 account types – Classic, Gold, Premium and Elite. They have different minimum deposits, spreads, leverage and financial instrument offerings.
It is worth mentioning the Alvexo Plus feature, which is very useful and helps to achieve better investment results. It will give the investor access to a number of services, such as trading signals, news, webinars, online news, etc.
Libertex forex broker offers one of the most popular investment platforms. It is also one of the better brokers in terms of spreads. It serves more than 3 million customers from 120 countries. In addition to the standard version of the platform, it also offers a mobile application, which uses its own software, but also gives the option to integrate with Meta Trader 4 and Meta Trader 5. New users can take advantage of a demo account, where virtual funds of 50,000 euros are available. As for the issue of fees, the EUR/USD pair can be traded at an average spread of 0.2% without any commission.
This forex and CFD broker also offers multiple asset classes. In addition to forex, it provides ETFs, stocks, indices and commodities. Advanced traders will appreciate the personalized charts and technical indicators that are available through the app, as well as the fast order execution time.
The XTB forex broker supports 48 currency pairs and does not charge any commissions. When trading on the EUR/USD pair, spreads start as low as 0.1 pips. Those with an unlimited budget are sure to appreciate that this broker has no minimum deposit policy. Moreover, deposits are processed free of charge. This broker offers both standard and swap-free accounts. Both allow you to trade without commissions, but with the former you can take advantage of lower spreads.
This is a CFD broker that is well established in the market and offers access to a wide range of markets. The broker supports as many as 55 forex markets, and you can trade commission-free on any of them. Spreads start at 0.9 pips on the EUR/USD pair. AvaTrader is one of the best Forex brokers with a PAMM account. Technical analysts will be pleased with the advanced tools available. Moreover, this broker has one of the best VPS on the market. It also provides a free demo account with market data and analysis data. Deposits can be made using the AvaTrader app and the minimum deposit is €100.
The online forex broker offers a Razor account with ECN pricing. Those with a Razor account have access to the lowest spreads on the market. This type of account is subject to a commission of €3.50 per lot traded, on all markets that are supported.
The standard account, which is offered by the broker, offers an average spread of 0.6 pips, but the trader does not have to pay any trading commissions. Those who have an account at Pepperstone have access to both the Meta Trader 5 platform and the older version, Meta Trader 4.
Trades can also be made using the mobile app for Android and iOS, which supports advanced technical analysis tools (read also: Forex account). A leverage of 1:500 is available for clients who meet the relevant conditions.
In addition to the foreign exchange market, the Pepperstone broker also offers stocks, indices, ETFs, cryptocurrencies and all through CFDs.
This is a leading broker for clients with US residency, although it also serves EU residents. It offers access to more than 80 major currency pairs, those less popular and exotic ones. Spreads on the EUR/USD pair start at 0.8 pips, and no commissions apply when trading in the foreign exchange market.
However, the minimum deposit for this broker is relatively high at €250. The broker’s mobile app is available to download for free, and all versions of the platform offer all features from trading tools, real-time pricing, order placement and market data.
Read also: How to invest on Plus500
This online forex broker offers a secure and regulated environment for EU and US traders. Traders have more than 70 different currency pairs at their disposal. They can trade major pairs with leverage up to 1:50 and 1:20 on exotic and less popular currencies.
This broker’s app is available for Android and iOS devices. It offers access to 82 indicators and 11 technical analysis tools, as well as real-time charts.
For the most part, traders choose to select an account with a spread-only model. This means that they pay the spread, one no commission is charged on these transactions. As for the core pricing account, the commission is 50 euros per 1 million euros traded, but the spreads are more competitive.
This broker specializes in high-level trading in the foreign exchange market. It is popular especially among traders who appreciate access to advanced tools. The broker is integrated with TradingView, which provides high-quality analytical data.
As for forex trading platforms, this broker offers one of the most widely used for charting for advanced and experienced forex traders. It offers extensive technical and economic indicators, along with drawing tools. What’s more, it has a clear interface and allows you to create your own watchlists.
The trader can also implement price alerts, which, once triggered, appear in the form of mobile notifications. Forex.com offers a minimum spread of 0.8 pips on the EUR/USD pair. It’s worth knowing that no commissions are charged, which also applies to other supported assets, in addition to stocks.
This broker specializes in CFDs, so it will not be suitable for clients from the US, due to domestic regulations. However, investors from other regions will get access to a wide range of currency pairs. The broker supports several types of accounts, so it meets the expectations of even the most demanding investors. As for the minimum deposit on a micro account, it is only 10 euros. Moreover, the account is not associated with any additional commissions.
The Advantage account will be suitable for active traders, among other things, because it offers a minimum spread of 0.0 pips on the EUR/USD currency pair. The minimum deposit is €500, and account maintenance is associated with an average trading commission of €0.4.
This forex trading broker provides an Android and iOS app that offers all the features. It also includes the ability to place trades with fast execution. Customers using this broker also have access to their accounts using Meta Trader 4 and Meta Trader 5.
How to use a forex platform?
Having already known what the best forex trading platforms are, it is useful to know how to use this tool. Step-by-step instructions are presented using the eToro broker as an example.
Opening an account on eToro
To do this, go to the eToro website and open the registration form. In it you need to provide the following data:
- First name, last name,
- Date of birth,
- Cell phone number,
- E-mail address,
- Username and password,
- Residential address.
In order to start trading, you need to confirm your identity, as well as your residential address. This is part of the KYC procedure. To do this, you will need to send a scan of an identity document, such as an ID card, passport or driver’s license, as well as a document that confirms your residential address, such as a bank statement or utility bill.
Deposit of funds
After logging in to the eToro platform, an investor can make a minimum deposit (read also: Making money on forex). For people from the US and the UK, it is 10 euros, but in most other countries, citizens will have to deposit 50 euros or even more.
Deposits that are made in currencies other than the USD are charged an additional 0.5% fee. Payments that are made in US dollars are free of fees. Instant deposits can be made with a credit card, debit card or e-wallet.
Once the funds are credited to the account, the trader can start trading. To do so, he can search for the currency pair he is interested in using the search bar.
The trader can click “trade” on the selected currency pair. The order form for the position will then be displayed. He can then choose between a buy or sell position and enter a rate.
Leverage can also be applied. The trader can select the preferred leverage limits in the appropriate box. To confirm the trade order, click “Open Trade.”
Types of Forex brokers – which type of broker to choose?
Before choosing the right broker, it is worth learning about their operating models. Each has pros and cons, and the decision to choose a particular type must be made based on individual preferences.
Broker Marker Maker
This type of activity occurs most often. It is a model in which a specific institution acts as a market maker, which creates its own market. A broker operating in this model sets the rate of the currencies in question, based on interbank rates. This means that for the investor, i.e. the buyer, the broker is the other party to the transaction. This can cause a conflict of interest, as the investor’s profit is a loss for the broker, and vice versa.
This forex trading broker has the following advantages:
- high liquidity,
- available micro-lots,
- possibility to execute any transaction,
- no costs for opening and closing positions,
- small deposit required or no minimum deposit,
- fixed commission for opening and closing positions.
The disadvantages of the Marker Maker broker, on the other hand, are:
- possible higher transaction costs,
- spread higher than under market conditions,
- conflict of interest between the investor and the broker.
This is a model in which the broker acts as an intermediary and is not a party to the transaction, as in the case of Market Maker. In this case, each investor’s order is transmitted to a special network, where the settlement of the transaction takes place. The most important thing is that all orders are visible in the sheet, and the buying or selling itself is done at the best rate.
The advantages of an ECN broker are:
- lower spread than in the MM model,
- less conflict of interest between the trader and the broker,
- no re-quoting.
A forex trading broker also has some disadvantages:
- higher initial deposit required,
- longer transaction execution time,
- commission is charged on each order.
In this business model, the broker directs the investor’s order straight to the bank or other financial institution. This means that the broker is only an intermediary, not a party to the transaction. The customer gets access to the actual market price. Platforms that operate in the STP model make money on the spread or impose their own margin on the rates offered by banks.
The advantages are:
- low transaction costs,
- low initial capital requirements,
- fast execution of transactions,
- no conflict of interest.
Disadvantages, on the other hand, include:
- this broker often uses the offer of MM brokers,
- charges a commission for orders.
Forex trading rules
Here are some rules and tips to follow when deciding to invest in forex.
This concept may sound a bit complicated, but it means a simple activity. The idea is to invest the capital you have not only in one type of asset, but several different ones, even for a small capital. This way, when one asset is losing value, you can protect some of your capital. Other assets held may even gain in value, so that the loss can be offset in some cases.
Acceptance of investment risk
Risks are inherent in investing. The investor must accept them, otherwise there is no point in him starting forex trading. Most brokers lose their first capital, and it is worth accepting this by investing as much as you can lose.
It is worth remembering to take a specific plan of action before starting to invest. Without this, it is not worth starting investing. An investment strategy is the basis for successful investing (read also: Forex strategies). You can rely on existing strategies or draw elements from different ones and create your own.
Expand knowledge related to investing
Before an investor undertakes his first investments, he should acquire at least the basics related to trading. Knowledge can be drawn from various sources, but it is best to opt for a forex trading course. Training courses of this kind are available online, as well as on-site, and are usually held in major cities. Both paid and free courses are available, so everyone can easily find the right one for themselves.
However, you can also get knowledge about investing from other sources, such as trading articles, eBooks, webinars or audiobooks. It is best to bet on well-known authors with extensive investment experience.
Investing as much money as you can lose
As you already know, investing in forex is associated with the risk of losing capital. Therefore, it is necessary to invest as much as you can lose and it will not negatively affect the investor’s household budget. Under no circumstances should you borrow money to make investments.
Invest in those financial instruments that you are familiar with
Do not immediately throw yourself into the deep end. You should first gain knowledge of the chosen instrument and then invest capital in it. As you gain knowledge and experience, you can broaden your investments and invest your funds in other financial instruments.
Taking advantage of a demo account
Currently, almost every broker offers a free forex demo account. Especially for novice investors, this is a good opportunity to try your hand and learn how the market works. It is therefore worth taking advantage of it, as you can trade virtual funds on it. The investor can freely allocate money and make moves that on a real account he would not make, watching what will happen.
The demo account can be used for as long as the investor feels confident to make investments in the real market. It is usually recommended to play on a demo account for at least 3 months. During this time, it is necessary to learn the operation of the exchange, the functions of the platform, as well as test the investment strategy.
Forex trading platforms – advantages and disadvantages
Using trading platforms has its good and bad points. The most important ones are presented below. This way you can decide for yourself whether it is worth using them.
Pros of trading platforms:
- Huge accessibility – currently almost anyone can trade Forex,
- The ability to use leverage and increase potential returns on investments,
- Many trades take seconds, minutes, hours, days at most, so you can make money faster than on traditional investments,
- Access to many free training materials (read also: Forex training courses for beginners),
- Lower number of fees, unlike the traditional stock market,
- Free access to many investment tools,
- Automated transactions.
On the other hand, the cons of Forex platforms include:
- They are not as well regulated as the traditional stock market, which can affect the integrity of brokers,
- Possible delays in order execution, which can affect either profit or loss generation,
- Sometimes a trader may come across obscure fees and transaction costs, so it’s a good idea to become thoroughly familiar with them beforehand,
- The need for self-study of everything related to the Forex market,
- High dependence on customer service in case of any problem.
Forex trading platforms – summary
Choosing the right platform for forex trading is not an easy task. There are many brokers on the financial market. Therefore, a trader should think carefully, cow offer to the greatest extent will suit his individual needs and goals.
Knowing what the most important factors to take into account when choosing a Forex platform, you can effectively increase the efficiency of your investments. However, it is necessary to spend some time on this. A beginner may need a slightly different trading platform, while a professional will certainly be satisfied with a tool equipped with many advanced features (read also: Forex for beginners).
Forex trading platforms are a useful tool, and in the version of the application for mobile devices they provide maximum convenience in making transactions and controlling investments (read also: Trading app). Beforehand, however, it is worth looking at various platforms and brokers’ offers, in order to choose the platform and offer that will most suit individual needs and requirements. This will make carrying out much easier and more convenient.
FAQ – frequently asked questions about forex platforms
Below is a list of the most frequently asked questions by novice traders.