Tips to Choose the Best Day-Trading Software

Capital Markets CIO Outlook | Tuesday, June 08, 2021

Day trading is a time-bound trading activity where buying or selling positions are taken and closed on the same trading day to make profits from smaller price differentials on large order volumes through frequent purchases and sales, usually on leverage.

Fremont, CA: Computer applications have made it easy to automate trading, especially for short-term intensive activities such as day trading, making the use of trading software very popular. The debate continues on the potential profit that can realistically be derived from day-to-day trading activities using online trading platforms, as brokerage fees and commissions are said to take away the bulk of the available profit potential. It is therefore essential to select the right day trading software for cost-benefit analysis, to assess its applicability to individual trading requirements and strategies, as well as the features and functions you need.

Day trading is a time-bound trading activity where buying or selling positions are taken and closed on the same trading day to make profits from smaller price differentials on large order volumes through frequent purchases and sales, usually on leverage.

What's Day-Trading Software?

Day-trading software is a computer program usually provided by brokerage firms to help clients carry out their day-to-day trading activities efficiently and timely. They often automate their analysis and trade, enabling traders to reap profits that would be difficult to achieve by mere mortals.

The features and functions available may vary from one software package to the next and available in different versions. Apart from brokers, independent vendors also provide day-to-day trading software that tends to have more advanced features. Some of the critical features of successful day trading software are discussed below:

Platform independence: if a trader uses highly sophisticated day trading algorithms involving high-end dedicated computers, a web-based software offering is advisable. Benefits include connectivity from anywhere, no manual updates, and no maintenance costs. However, if you are using highly complex algorithms that require sophisticated computation, it is best to consider dedicated computer-based installable applications, although this will be expensive.

 Your particular needs for day trading: are you adopting a basic day-trading strategy of moving-average tracking on stocks, or are you trying to introduce a comprehensive delta-neutral trading strategy, including options and stocks? Do you need a forex feed, or do you trade in particular items such as binary options? Trusting claims on the contents of the stockbrokers' website is not enough to understand the bid. Ask for a trial version and test it thoroughly during the initial process. Alternatively, review the screen-by-screen demonstration (if available) from the stockbroker or vendor to understand the best match for your day-to-day trading needs clearly.

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