How do online trading platforms work


In finance, an electronic trading platform also known as an online trading platformis how do online trading platforms work computer software program that can be used to place orders for financial products over a network with a financial intermediary. Various financial products can be traded by the trading platform, over a communication network with a financial intermediary or directly between the participants or members of the trading platform. This includes products such as stocksbondscurrenciescommoditiesderivatives how do online trading platforms work others, with a financial intermediary, such as brokersmarket makersInvestment banks or stock exchanges.

Such platforms allow electronic trading to be carried out by users from any location and are in contrast to traditional floor trading using open outcry and telephone based trading. Sometimes the term trading platform is also used in reference to the trading software alone. Electronic trading platforms typically stream live market prices on which users can trade and may provide additional trading tools, such as charting packages, news feeds and how do online trading platforms work management functions.

Some platforms have been specifically designed to allow individuals to gain access to financial markets that could formerly only be accessed by specialist trading firms. They may also be designed to automatically trade specific strategies based on technical analysis or to do high-frequency trading. Transactions have traditionally been handled manually, between brokers or counterparties. However, starting in the s, a greater portion of transactions have migrated to electronic trading platforms.

These may include electronic communication networksalternative trading systems" dark pools " and others. How do online trading platforms work first electronic trading platforms were typically associated with stock exchanges and allowed brokers to place orders remotely using private dedicated networks and dumb terminals.

Early systems would not always provide live streaming prices and instead allowed brokers or clients to place an order which would be confirmed some time later; these were known as ' request for quote ' based systems. Trading systems evolved to allow for live streaming prices and near instant execution of orders as well as using the internet as the underlying network meaning that location became much less relevant.

Some electronic trading platforms have built in scripting tools and even APIs allowing traders to develop automatic or algorithmic trading systems and robots.

The client graphical user interface of the electronic trading platforms can be used to place various orders and are also sometimes called trading turrets though this may be a misuse of the term, as some refer to the specialized PBX phones used by traders.

During the period from tothe development and proliferation of trading platforms saw the setting up of dedicated online trading portals, which were electronic online venues with a choice of many electronic trading platforms rather than being restricted to one institution's offering. From Wikipedia, the free encyclopedia.

Retrieved 10 June Retrieved from " https: Electronic trading platforms Share trading. All articles with unsourced statements Articles with unsourced statements from September Articles with unsourced statements from March Views Read Edit View history. How do online trading platforms work page was last edited on 3 Aprilat By using this site, you agree to the Terms of Use and Privacy Policy.

Online trading is basically the act of buying and selling financial products through an online trading platform. These platforms are normally provided by internet based brokers how do online trading platforms work are available to every single person who wishes to try to make money from the market.

While trading Shares like Google or buying and selling Commodities like Gold or Silver might be quite familiar, Forex trading has gained extreme popularity over the last couple of years due to some of its major features. To make this simple, imagine you are getting ready for a trip to New York and you exchange Euros into Dollars.

A week later, your trip is unfortunately cancelled and how do online trading platforms work decide to change your Dollars back into Euros. Surprisingly, you end up with Euros: This is known as a profitable foreign exchange trade. You initially purchased Dollars at a certain rate of exchange and during the week that followed, the value of the Dollar went up against the value of the How do online trading platforms work. Without even meaning to do so, you managed to make a small profit as you bought your Dollars at a low rate and sold them back at a higher rate - the aim of any successful trade.

Nowadays, there is no need to go to a bank or post office, or even leave your house for that matter - you can simply trade online using your home computer or mobile phone. As mentioned above, from the palm of your hand you can trade Forex, which includes currencies such as the Dollar or Euro, a variety of Commodities such as Gold or Oil and even major market indices.

You can open a trade by selecting a product, amount and direction, and close it if your trade is in profit at how do online trading platforms work time you choose. On top of our lower spreads, we take care of our customers by providing them with further spread discount campaigns! However, if you invest with only a small amount, the profit you can make will also be relatively small. When using leverage you can increase your purchasing power and simultaneously increase your profit potential.

Instead of a 5 Euro profit you made when you exchanged your Euros to Dollars and back, you could have made a profit of upto 2, Euros. Please note that while trading with leverage can work in your favor, it can also work against you and cause higher losses. Opening a trade involves three steps: Get the feel of trading with our unique simulator.

You can also learn more about our customizable and advanced trading platforms here. Some people choose a certain investment based on emotions or go according to a recommendation made by a friend. Others may choose to follow the advice of an investment advisor or make a decision based on their own accord.

Whatever you decide to invest in, we strongly advise taking it slowly and cautiously. You can even use some of our educational material to improve your trading knowledge. By accessing this website you confirm that you are legally permitted to view its content and use its services. This site uses cookies. By browsing the site or by closing the message you are agreeing to our use of cookies. Read our privacy policy. What is Online Trading? How to Open a Deal 3 Ways to Start.

All our representatives are busy right now. To avoid any further delays our team will contact you via email as soon as possible. To help us serve you better, please provide the following information: What language would you like to chat in? How do online trading platforms work a complete list of products Click here. Lower spreads on every deal With iFOREX you can open trades with some how do online trading platforms work the most competitive spreads in the industry!

Demo Choose an Instrument: Choose the deal Size: Our clients tend to start out in one of the following ways: Via a meeting with a trading representative, where you can learn the basics. Get a Free 1-on-1 Session.

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