Simply put, online trading is the act of buying and selling any financial product through an online trading platform. Usually, trading platforms can be provided by the online broker you choose or they can be independent. In the case you’re interested in trading the Forex market, one of the most used trading platforms is the MetaTrader platform, which in independent from any broker.
Since it’s one of the best Forex trading platforms, many online brokers recommend it and you can use it without any problem. Either when you want to use a demo account or a real account, you just need to open an account with the broker and download the MetTrader platform to your computer, When it asks for your login information, you should use the data you got from your broker and you can actually trade using it. This makes online trading a lot easier.
In the old days, when you wanted to buy or sell a stock, you would need to call your broker and tell him what to do. With the Internet and the new technologies that are now available, you just need to download and install a simple software and you can start trading online.
One of the main advantages of Forex trading is the fact that, even if you’re a beginner, you can test your skills before you start trading real money. For that, all you need to do is to open a demo account with any broker of your choice – and this step also allows you to know more about the broker and how reliable they really are -, and start trading. You can choose the amount that you’re going to start with and then you can practice for the time you want.
Even if you’re not a beginner, demo accounts are a great way to test your trading strategies in real time. Even though you may have designed a trading system that has been proved to work with backtesting, this doesn’t assure you that it still continues to work. So, opening a demo account and following all the rules of that trading system will allow you to know if it’s working, what’s not, what can be improved, improve it, and start over once again.
Another important advantage of online Forex trading is the fact that there are no commissions. Unlike when you’re trading a stock, where you need to pay the broker the transaction fee, in the Forex market that fee doesn’t take place. The only thing you need to pay that slightly resembles a fee is the spread (the difference between the bid and the ask price).
Author: Editorial staff of 70trades reviews blog