Last Updated on: 22nd November 2023, 12:33 am
When you decide to start CFD trading, one of the most important things you can do is choose the right trading platform. You will come across a wide range of forex trading platforms in the market. Choosing the right one can be confusing and consuming. Every platform offers an array of products and services to choose from.
To ensure you do not get overwhelmed with all the choices available, you need to know what to look for in the best trading platform.
Here is what to consider when looking for a CFD trading platform.
Security
The security and safety of your data should be your primary concern. The best way to know whether a platform can be trusted is by checking the background. Check for reviews, comments or complaints about the platform. The track record of any trading platform will speak volumes.
CFD trading platforms in Australia are regulated, and monitored by a body called ASIC and are licenced under the CySEC. Check to see that the platform you seek to trade on is registered with these two bodies and any other relevant global authorities.
Initial deposits
When you are new to trading, a primary concern for most traders is the initial deposit required by the trading platform. Choosing online platforms that offer low deposits is not always the best thing to do. The best platforms have high initial deposit requirements. This is a measure taken to attract serious clients. Therefore, do not be afraid to put in that huge initial deposit. It is an assurance that you are trading with the best in the market.
Most assets offered by trading platforms are volatile. Therefore, ensure you optimise your trading account to cope with market fluctuations. You are probably already aware of the issues posed by under-capitalisation. Therefore, this should be an important consideration to make before you begin trading. Only ever risk what you can afford to lose.
Withdrawing your funds
Making deposits into your AU trading account is a smooth process. You need to ensure that the platform you choose offers the same ease in funds withdrawal. Be wary of platforms that cause delays when you need to withdraws your funds. Also, the best platforms offer an option for account closure without causing issues. Ensure you ask about these essential services. If they cannot guarantee smooth operating procedures, you should not commit to the platform.
The spread
Spreads are important to all CFD traders. As a beginner, it is best to go with a seasoned broker. While they charge higher for their bid-ask spreads, you can trust their trading judgement and track record. Remember that you will be required to pay out the spreads whether you make money or lose money. The choice between a brokers offering low spread or one that offers high spreads with a reputable history will depend on your trade expectations.
Account types
Most trading platforms offer a wide range of choices when it comes to account packages. Your choice of account depends on your personal preference and trading needs. Sometimes, a platform can offer one account package but with options for customisation. This is a good alternative as it offers flexibility. You can adjust your leverage and margin requirements to suit your needs and preferred experience.
Leverage and margin rations
If you are starting to trade CFDs, going for lower leverages is the best option. The best trading platform will allow you to customise your ratios as you develop your trading skills on leverage and margins. High leverage ratios are only ideal for seasoned traders with proven success records. However, even the best traders in the market do not go beyond the 10-1 ratios.
The trading software
The best trading platforms are characterised with sleek interfaces and easy to use software. Go for a platform that offers high-level automation as it reduces the risk of 3rd party interference. Also, ensure the AU trading platform offers the choice of starting with a demo account. This gives you a chance to try out the platform without risking real money.
Conclusion
When you consider the above mentioned critical factors that affect platform choice, you will find it easy to make good decisions on the simple factors.
