Almost every online FOREX broker has a
software package for their clients to make transactions and get information
about market prices. Due to the relative maturity of online trading there is a
consensus among FOREX brokers about what clients need in terms of software
tools. There are two main classes of FOREX software – web based and client
based.
All FOREX software needs to provide
up-to-the-second market information. The fast moving pace of the FOREX demands
real-time data delivery for making decisions about when to enter and exit the
market. FOREX dealers claim their software performs well with a minimum of
delay, but in fact there can be a number of factors that could delay data
transmission.
Internet connection speed and distance
from the broker's servers are the two main factors that can slow down data
transmission. FOREX traders should have a reasonably modern computer and a high
speed Internet connection to take full advantage of the FOREX software offered
by their broker. It may also pay to choose a broker in the same area as you
live.
Traders in Bangkok who deal with
brokers in Ohio may experience delays – especially during volatile market
conditions.
Web Based or Client Based?
Web based software is on the broker's
website – you don't have to install any software on your computer. Client based
software requires you to download and install the software package used by your
broker. Which is
better?
More and more brokers are offering web
based client software for reasons
of convenience, safety and
reliability. Web based software allows you to
log on to your account from any
computer – you can make trades from any
location that has an Internet
connection. Client based software, on the
other hand, restricts you to making
trades from just one computer.
Besides the convenience, web based
software offers greater security.
Data is secured with high-strength
encryption making it impossible for
outside parties to access during
transmission. Client based software is
also secured during transmission but
there are more possibilities for data
loss from the trader's computer.
Viruses and hackers may be able to
access valuable financial data stored
in a home or office computer.
Features
FOREX software needs to access
real-time quotes and offer a means to
enter and exit the market. Even the
most basic packages offer these
functions.
Current quotes can be seen for most
currency pairs and the software
allows you to buy or sell at market
prices or enter and exit the market using
stops or limits. Ideally, trading
software should have integrated charting
functions with a variety of viewing
functions.
Basic software packages should be
offered free of charge, but many
brokers also have more advanced
packages available for a monthly fee.
Some of the features you could expect
to see in advanced software
include the ability to trade directly
from the chart and full analytical
functions.
Technology
The backbone of FOREX software is a
series of data servers that allow
you to connect to your broker's web
site and make transactions. Servers
operated by the FOREX broker need to
be reliable and secure for
maintaining data integrity and
assuring accurate transaction processing.
Servers are subject to power outages
and natural disasters, so to ensure
maximum uptime, the broker should
operate at least two sets of servers in
separate locations. Brokers should
also offer regular data backups to
guarantee the integrity of their
customer's financial data in case of server failure.
