Core Liquidity Markets MT4 Platform
Technology plays a very important role in Forex trading. Technology in Forex Trading has many different meanings. Technology in Forex has led to the development and expansion of direct market access Forex brokers. These Forex brokers take the price feed from various banks and funnel them through the technology which then intern is presented to the trading system for their clients to trade.
This type of technology which is provided by these Forex brokers will lead to more market transparency. It will also provide the Forex trader with the opportunity for best execution. Several years ago some technology companies introduced a new system which was known as ESP which stood for executable streaming prices. In short this means that the Forex trader will trade on prices that are the same as the interbank market and provided by the banks and other liquidity sources.
Another development which brought more market transparency was the introduction of depth of market. Within the trading software the broker would show which liquidity sources are available at the various prices. This can help of Forex trader determine market direction and at which time to enter or exit a particular market.
Many hedge funds and professional trading operations have implemented and made use of what is known as API trading. API stands for application programming interface. This allows the hedge fund or trading route to integrate a trading system to the brokers system. In this case they do not need the use of a trading platform to execute their trades as it as it is done from signals from their trading system. Communication between many of these train systems uses what is known as FIX protocol. FIX stands for financial information exchange. This is the standard that is used by major financial institution institutions and how their systems communicate with each other.
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Trading Forex and Derivatives carries a high level of risk, including the risk of losing substantially more than your initial investment. Also, you do not own or have any rights to the underlying assets. The effect of leverage is that both gains and losses are magnified. You should only trade if you can afford to carry these risks. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary.