How to Choose an Online Trading Platform
As the internet has evolved and become a natural part of our everyday lives, the entire financial industry has changed. No longer do you have to go through a financial advisor, portfolio manager, or stockbroker to execute trades. You can handle it all from the comfort and convenience of your computer or mobile device.
But with so many different online trading platforms available, trying to choose the right one can prove to be challenging.
6 Things to Think About
Online trading platforms are a dime a dozen these days. You’ll find lists ranking the top 25 or 50 platforms on the market, and there are dozens more that don’t even make the lists. With so many different options, how do you possibly make a decision?
While there are plenty of personal factors that come into play in the selection process, here are some things you should be thinking about:
- Trading Capabilities
The easiest way to narrow your options is to think about trading capabilities. Certain platforms have specific functionality and there’s no sense in considering ones that don’t meet your criteria.
For example, RJO Futures is a leader in future trading services. If you’re considering trading futures, they should be at the top of your list. But if you’re trying to day trade stocks, you’re better off going with a platform like TD Ameritrade.
- Security and Reputation
Cybercrime rates are at an all-time high. Any time you’re entrusting an online platform with your personal information and financial assets, you have to do your due diligence and make sure they have the right security infrastructure in place to keep you safe.
What you’ll find is that leading trading platforms that are backed by reputable brand names usually have sufficient security. However, it’s the lesser-known platforms that you need to be worried about.
In today’s fast moving financial marketplace, you need a platform that is accessible wherever you are. Whether you’re in your office using a desktop computer, or you’re in a hotel lobby on summer vacation with your family, having access to your trading platform at all times is a must. Choosing a platform that syncs up with an accompanying smartphone app is a smart decision.
- Fees and Expenses
While it shouldn’t be the first thing you check out, you do need to think about the fees and expenses associated with different trading platforms. Depending on how many trades you make per day, variances in fee structures could prove to be a very important differentiating factor.
Most trading platforms have a bit of a learning curve associated with them. It’s also not uncommon for there to be occasional errors, bugs, or issues. The question is, does the trading platform offer quick, responsive support for your needs? The best ones do.
- Comfort Level
When it’s all said and done, how comfortable are you with one trading platform over another? When all other metrics are equal, it comes down to choosing the platform that minimizes distractions, promotes efficiency, and puts your mind at ease. This is something only you can figure out.
What’s Best for You?
Ask around for suggestions regarding which online trading platforms you should use and you’ll get a number of responses. One person will be adamant that a particular platform is best, while someone else will totally discredit the same system. When it’s all said and done, you have to do your own research and figure out which features and metrics align with your needs and preferences.