Comments on: Understanding How Trading Works

By: Common Sense

Common Sense — Tue, 23 Feb 2010 12:48:59 +0000

A "Platform" is simply the format that allows you to trade financial instruments (stocks, options etc.). No platform will quarantee that you can’t lose money but they provide the tools to help manage to keep your losses to your requirements. (keep in mind…. if (for example) a stock drops very quickly…. there is no tool on a platform that will save you).

A good Trading Platform will have;
Good charting (clear, many studies, many timeframes)
Many "Order Types": Besides BUY, SELL, STOP & LIMIT;
One Cancels Other
Blast (many orders sent at one time)
Determine date & time you want to execute
Set cancell date and time
etc.
Set ALERTS to let you know when a stock has reached a certain point
Level I & Level II quotes (depth of market)
Good ways to filter stocks by criteria (for leads to buy or sell).
In general the best platforms are "software based" vs. Web based.

Examples of good software based "Platforms" are;
ThinkOrSwim (somewhat hard to learn, best overall package, best educational features, always getting better)
TradeStation (hard to learn, has backtesting)
Interactive Brokers (very hard to learn, least costly & most products available to trade)

Very experianced traders take advantage of "good platforms". They know how valuable the tools are and will use them to their trading advantage.

You may only appreciate a good software platform after using a web based platform for many years.

References :

By: Ted

Ted — Tue, 23 Feb 2010 12:46:59 +0000

A trading platform is simply a computer program that collects all the information on your account and trading positions in one place. In addition, it allows you to do research and track investments that you are considering and watch current quotes. Then it allows you to enter orders which your computer transmits to the broker’s computer for execution.

Your assets are still in your account just as they would be if you didn’t have a trading platform and traded by making phone calls to your broker.
References :

By: Stephanie

Stephanie — Tue, 23 Feb 2010 07:44:22 +0000

How do Trading Platforms work?
Im not understanding how trading platforms work and I was wondering if someone here can explain them to me. What exactly are the traders trading and how can they guarantee that you cannot lose the asset you are placing on the platform?
I need this information in real terms that I can understand. (The crayon and colorbook version if you will)