With so many different ways to trade online, it is not unusual to wonder whether the terms trading platforms and forex trading platforms refer to the same thing or not.
The internet and the associated technology have made some long-stride in different sectors of our life. It has changed the way we shop from retailers, consult a doctor, enjoy media contents like TV shows and songs, get our education and knowledge – you name it and it would perhaps be possible on the internet. It has become integral to our lifestyle with numerous revolutionary effects.
Hence, it’s not a jaw-dropping matter that one can also trade and invest in the financial markets over the internet. Thanks in part to the digitalisation of the stock exchanges that began at the turn of the millennium as well as the advancement in fintech, it is now possible to access most major stock exchanges online and in real-time and position trades on different assets and currencies. All that is needed are a reliable internet connection, a compatible media device, and a functional trading platform. For currency trading, you can just do with the forex trading platforms too.
But First, What is a Trading Platform?
In its basics, a trading platform is a software or computer program. It has its purpose, which is to facilitate an interface where traders and investors can place a trade in particular tradable assets in the financial markets. The platforms are usually operated by online brokers and financial intermediaries, who execute the trade orders on the trader’s behalf.
Depending on the broker’s origin and the region it’s offering its trading services, the platform needs to fulfil certain criteria and comply with the financial regulations. They also need to provide a safe, reliable, and easy interface to access the markets in real-time.
To do so, trading platforms come with many different features. It allows the traders to open a trading account, deposit money into it, and make withdrawals. It also usually comes with a real-time price chart, research data, fundamental and technical analysis tools, pre-market order placements, etc. Some platforms also offer automatic investment with preset criteria set with your bank cards.
It Sounds Like a Forex Trading Platform, Doesn’t It?
You see, depending on the size and scale of a particular trading platform, it can offer stocks, bonds, indices, ETFs, CFD trading, commodities, and just about any other tradable assets. It can also offer a few or just one particular type of financial instrument to invest in. This variation is what confuses many about forex trading platforms.
By definition, a forex trading platform is software that offers real-time access to the international currency market, enabling users to explore and trade on forex pairs. The only instrument it offers is different currencies while sharing pretty much everything else with other trading platforms. So, no, while every forex trading platform is a platform in the main, not every trading platform is a forex trading one.