Ever since internet trading became to people’s living rooms the amount of online trading software that came out is staggering. Stock analysis lends itself very well to computer software and with the ability to replace so many manual tasks, trading online has never been easier. The days of manually trading trend lines and looking long and hard at empty graphs was finally over. Today you can see super sophisticated stock data at the push of a button.
So, what’s the deal with online trading software and what do you really need as a trader? It really all depends on what your skill level and your investment level is. Trading software varies significantly in terms of price and complexity. Here are 3 basic categories of software:
– Trading Platforms
This is the software that enables you to place trades with your online broker. Professional traders all use very sophisticated trading platforms and they have level 2 access to live trading data on all the major exchanges. Your online broker will provide you with a trading platform although most of them won’t give you live trading access you will use the online trading platform to buy and sell shares online. Some brokers do give their high end users more sophisticated software (usually free of charge).
– Analysis Software
Most third part online trading software falls into this category and this type of software allows you to do in-depth and very specialized analysis at the push of a button. Not only does it take a lot of the complexities out of technical trading but it can really take a lot of the manual work out of identifying trends. The downside is that many of these software packages are quite expensive and the learning curve can be steep. Make sure you know what you are getting into before you buy one of these packages.
– Stock Picking Software
A lot of the so-called “trading robots” are designed to analyze stocks and identify clear buy and sell signals. Although there’s a lot of debate about the subject and often a lot of criticism this type of software is here to stay. Many traders swear by this and some even use it blindly as the only trading tool. Regardless of your opinion of it it’s been proven to be effective and it’s improving by the day.