Choice Of Trading Platform
Content of the lesson
In this lesson, you will learn the basics of trading platforms, which are valuable tools used in making trades.
We will also introduce the trading platforms that are part of the course.
What is a trading platform?
A trading platform is a software through which your broker links your trades to the marketplace. It is equipped with the capacity to display both real-time and historical market data when linked to a data provider. In other words, it can be used to import a security’s historical data, primarily price and volume data.
On a trading platform, price data can be illustrated in charts and may be used to calculate technical indicators. Also, the platform is an excellent tool for building, backtesting (testing on the historical price action), optimizing, and validating the strategies you want to use in your trading.
However, the main use of a trading platform is for analyzing trade signals and spotting trade setups in line with your strategies to know when it is appropriate to buy a security. Also, a trading platform can be used for automatic order placement, provided you use an online broker that is compatible with the platform.
Do I need to use a trading platform?
If you want to trade on your own, you need a trading platform to communicate your orders to the marketplace via your broker. Without a trading platform, you won’t be able to trade the strategies offered in the course.
A trading platform is very important for anyone who wants to develop into an independent trader and create and test your own strategies. You can purchase one or subscribe for any period you want. For most platforms, you can test them for free for a short period before purchase or paid subscription.
In the course, we will present the basics of the platforms that we believe are good for day trading.
Which trading platform should I choose?
There are several different trading platforms in the market that can be very useful in trading. But when it comes to day trading and the type of strategies we use, there are only a few platforms that can meet our high demands for market data, backtesting functionality, and fast order execution.
Many platforms do not meet the requirements necessary for effective day trading since they simply do not have the functionality needed. For this reason, we have to focus on only the following platforms:
Amibroker: Amibroker is perhaps the cheapest option out there, you buy a lifetime license for less than 500 USD, but that doesn’t mean it’s low quality. Quite the contrary. It’s fully customizable and you can basically code or program whatever you want (if you have the knowledge). You can backtest, scan, explore, and connect to your broker. However, compared to the other trading platforms Amibroker might require a bit more programming kills. But if you only manage to learn 1% of the capability, you have come a long way and most likely are able to do all you want.
Amibroker is not a broker and you need to connect to a broker if you want to automate your trading. This is not difficult, but a bit cumbersome. For your convenience we have built a separate Amibroker course that has two modules: a basic module and a more expensive module that involves code for automatic trading via Interactive Brokers:
Interactive Brokers (IB): IB is a well-known broker and is by many regarded as the premium broker for traders. Commissions are low and the available markets are many. Most trading platforms have a “bridge” so you can connect to IB and execute your strategies live and automatically. For example, Multicharts and Amibroker have made their own software so you can easily go live with your backtested strategies via IB.
Summary
Trading platforms are valuable trading software with many smart functions that both facilitate your trading activities and offer good opportunities for creating and testing your own new strategies.
Further reading: