In South Africa, Forex trading is going from strength to strength. The country is the continental leader in terms of daily volumes. Today, its residents are the most valuable clients for international brokers. They use advanced software to access different markets. However, not all trading terminals are equally convenient. Discover key distinctions and advantages to look for.
Classification of Systems
Trading platforms may be universal or proprietary. First, there are popular terminals like MetaTrader 4 and MetaTrader 5. They are offered by myriad brokers around the world. For them, it is a cost-effective solution, as they do not invest in app development.
These ready-made systems are versatile and allow trading on any device — PC, laptop, tablet, or smartphone. Web-based versions work directly inside browsers, so no downloads are required. However, some brokers stand out because they offer more than just standard solutions.
Unique proprietary apps are designed to meet the needs of a broker’s audience. Famous examples like the FXTM Trader are impressively powerful and multifaceted. At the moment, this app gives access to over 250 trading instruments, dozens of indicators, live quotes, and easy account management through a dashboard.
Range of Instruments
Today, online trading is not limited to foreign exchange. Even though it is the largest financial market with a daily turnover of 6 + trillion US dollars, other assets are just as attractive. Now, experienced traders have portfolios across multiple markets. There are:
- Major, Minor, and Exotic currencies;
- spot metals like gold or silver;
- stocks of the largest world corporations;
- CFDs on different underlying assets, from oil to S&P 500;
- binary options, etc.
For an advanced trader, it is convenient to manage all of their instruments from one place. Hence, developers program their systems to support a range of markets. For example, using the FXTM Trader app, you may access over 250 various tools across the above-mentioned domains. This way, your convenience is enhanced, and there is no need to juggle different systems. You can gain exposure to corporate equity, commodities, market indices, currencies, and cryptocurrencies, etc.
Range of Analytical Tools
Traders analyze the market using two major systems — fundamental and technical. The first approach requires access to economic and political news, as decisions are based on updates regarding:
- interest rates;
- oil prices;
- unemployment figures;
- changes in exports and imports, etc.
The best systems are also equipped with economic calendars. Keeping track of all fundamentals is daunting. Fortunately, such features condense all consequential events, so the trader knows what to react to.
Technical traders focus on patterns on price charts. They apply indicators to different time frames to spot Morning Stars, Hammers, and other patterns which tell them how to trade. A powerful platform will have dozens of technical indicators. Some systems, such as MetaTrader 4, allow the addition of custom indicators as well.
To sum up, the best trading platforms offer tools for both categories of analysts. You should have access to streaming quotes and economic news, as well as price charts with adjustable time frames and multiple indicators. For instance, MetaTrader 5 features over 80 indicators and analytical tools across 21 timeframes — from one minute to one year.
Copy Trading Features
Sometimes, you may have no time for thoughtful market analysis. However, this is not a reason to put your progress on hold. Global brokers like ForexTime allow you to connect to a strategy manager who will manage a portion of your balance. Clients may pick an expert from a detailed rating with performance assessment and the user feedback.
Copy trading is based on delegation. Once the connection is established, the all current and future positions taken by the expert will be replicated in your own account. This looks as if you were following identical strategies. For you, this translates into passive profit. For the expert, the incentive is a fee they receive if their methods are successful.
The most popular software supports this system. You can easily connect to your chosen manager and trade without active participation. Importantly, you may always terminate the connection altogether, or cancel separate trades. This is possible for clients of international brokers that operate in South Africa.
Types of Orders
Trades are executed differently depending on the order type. Market orders are executed immediately at the best available price. Pending orders allow traders to set trigger values like Stop Loss and Take Profit. When these are reached, the trade is executed, which ensures desirable conditions.
Stop Loss is a vital risk management feature. Traders should set it for every single position, as it limits their potential losses. Take Profit, on the other hand, allows the user to secure a certain amount of profit.
These tools are essential because market dynamics are beyond any trader’s control. Fundamental forces which drive the market, such as supply and demand, interest rates, oil prices, etc., are not fully predictable for the user. They must protect what they have before risking more capital.
Demo Trading vs Live
Recommended terminals have two modes — live and demo. The first one opens access to the actual market, while the second one is a trading simulator. Brokers register demo accounts that unlock this environment.
Usually, these are unlimited and free. Users may practice the following strategies, managing trades, and analysing charts in a system that imitates real conditions. Without practical training, you are very unlikely to make money in the market straight away; this stage is simply indispensable. Steer clear of brokers and systems that do not offer a demo mode.
Choosing a Platform
Most brokers recommend several trading systems, so their clients have a choice. Today, MetaTrader 4 and MetaTrader 5 are the most common options. However, proprietary terminals are also powerful.
Remember that your choice of a broker is crucial. If it is unregulated, all your trading efforts will be futile. In South Africa, it is preferable to work through an organization licensed by entities like the FSCA, the FCA in the United Kingdom, or the CySEC in Cyprus.