If you want to be a successful trader there are two things that you should never forget. The first is that it is a business, your approach must be serious and you will need a trading plan. The second one, however, is to use any advantage you can get. And one of the biggest advantages comes in the form of technology. After all, it has come a long way.
1. The Old Way
In recent history, in order to place an order you had to use your phone and call the broker. Your broker would then call the floor trader and he is the one who would actually trade. The floor broker had to be physically at the exchange. However, as you can see, that process lasts. In fact, it was not that rare for the price to change significantly in this time. And you wouldn’t even know what happened. After all, you had no live information.
2. The Evolution
On the other hand, today’s technology will allow you to trade so much more effectively it is almost incredible. In fact, you no longer have to have a broker to trade. You have the opportunity to do it from your home. The computers are far superior to what we had back then, there are markets that exist solely online and you have direct access to trading. Now, more than ever before, an independent trader can compete with institutional traders. You even have highly advanced stock simulators which you can use to test out your systems.
3. The Computer
Your computer is going to be the main tool you will use. If you can afford it, you should definitely have a designated trading computer. After all, all of the research, testing and trading will go through that unit. Alternatively, if you are using your regular computer to trade make sure you are protected. Any viruses or malware might cost you a lot.
4. The Specifications
While there is a bit of browsing to do, your tasks will be demanding. For that reason, you will want a powerful computer. Get the fastest processor you can afford and a reasonably powerful memory. Getting a second monitor can also be very helpful. With it, you will be able to monitor multiple charts and markets. Remember, a separate window for order entry should always be available if the situation requires immediate action.
You should also be prepared for power outages. Get a UPS and have your phone at the ready. In the case of a power outage, you might need to call a broker. Not to mention that if your phone is good enough, you can use it to trade.
5. Internet Connection
This should go without saying, you have to have a stable connection to the Internet. And not only stable, you want it to be fast as well. The market is moving faster than ever and you do not want to miss out on an opportunity because you were waiting for a page to load. Paying extra for a faster connection will probably pay out.
6. The Software
Now, there are three tasks your computer will have to do for you to be useful. It will need to Test your plans, analyze the market and execute the orders. To expand on this: The analyzing software will do wonders. Depending on your style, you will use the EOD (end of day) analysis or real-time. The backtesting is something that was, up to recently, only available to select few. Now, however, anyone can do it. And even more, newer systems offer multivariable optimization so that your systems can be accurately tested. And, lastly, you will need to have at least one entry interface.
Nowadays, there is an application for anything. And the market is not an exception. There are apps for news, price charts, analysis and realtime movement. Being proficient in the use of these will definitely help you with your goals.