5 Must Have Features to Look for in a Smartphone Trading App

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Being able to access the global market through the internet has made it possible for investors to trade around the clock in spite of location. The introduction of trading apps which can be installed and used on mobile devices has further taken this convenience to the next level. Many brokers offer different trading apps and platforms so scrutinizing the most popular ones will help you settle on the one that is most practical for you.

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You can refer to https://tradingguide.co.uk/awards/stock-trading-apps/ to have an overview of the most popular trading ups that currently exist in the market.

 

So what does an efficient trading app look like?

Before we delve into specifications about the app, it is important to ensure that you have the appropriate environment in the form of hardware/software to support the application’s needs. Any device with stable internet connection, at least 2GB of RAM and a 1.8GHz processor should do the trick. It also helps if your phone has at least 500MB of free internal memory. This will facilitate applications to run concurrently without slowing down. For your trading experience to be stress free, you need to have instant executions whenever you plan to open or close a trade.

Another precautionary measure that you need to remember is that for most apps to function optimally your phone needs to have the latest OS build supportable by that model.

 

Leverage

A good trading platform is one that allows you to adjust your leverage to suit your trading plan. Depending on the capital available, most retail traders prefer leverages above 50 but institutional investors prefer to keep it much lower. (Leverage is often directly proportional to capital).

Leverage is a functionality offered by brokers whereby they allow you to enter a trade that is worth more than your account balance. For example if your account has $100, a broker can offer you a leverage of 100:1. Which means that you can enter into a trade worth $10,000. This translates into bigger profits but also could mean huge losses in the event that price goes against you.

Leverage goes hand in hand with margin which in essence is expressed as a percentage of funds you need to have in your account so that the broker can allow you to open a trade. Many intraday traders deposit small amounts of money into their accounts so they would benefit from lower margin requirements.

 

Order types

In forex trading, the type order defines how an investor executes a trade. There are different types of orders that a platform can provide so it is important to ask the platform provider before depositing your funds. There are two basic types of orders:

  • Market order – This is when an order is executed immediately you place it in real time. For it to be legitimate, the price at which you place the trade is the price at which it should be executed. Always be on the lookout for brokers that execute your order at a price that is different from where you placed it.
  • Pending order – As the name suggests, this is a trade that you place ahead of time and is only executed when a certain set of conditions have been met. Pending orders are further classified into limit orders and stop orders. When buying, limit orders are placed below market price and while selling, they are placed above market price. Stop orders, when buying, are placed above market price and when selling, they are placed below market price.

 

Charting tools

The experience of trading on a smartphone should not be far removed for that which you get on a computer. Charting is an essential part of trading therefore the tools necessary should also be available on the trading app. The platform should allow you to select different types of charts like candlesticks, bar charts and line graphs. It should also allow you to place indicators such as trend indicators, oscillators, moving averages, Fibonacci retracements and channel lines.

 

Risk management tools

Trading using real money is inherently risky business. However, this doesn’t mean that your broker should not provide you with risk management tools. The most important risk management rule is negative balance protection. This simply means that however badly your trade goes, the broker will never send you a bill to settle. So if your margin runs out, the platform should automatically close your trade using a margin call to prevent it from getting to negative figures. Regulators like the FCA have actually stipulated that financial service providers automatically close an investor’s position as soon as funds drop to 50% of margin required to keep the trade open.  Stop loss is another important feature that the platform should have. It works in such a way that once a certain price is reached, the trade is automatically closed so you are able to protect your capital from total depletion.

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