Software e-trading securities brokers
In finance, an electronic trading platform also known as an online trading platformis a computer software program that can be used to place orders for financial products over a network with a financial intermediary. Various financial products can be traded by the trading platform, over a communication network with a financial intermediary or directly between the participants or members of the trading platform.
This includes products such as stocksbondscurrenciescommoditiesderivatives and others, with a financial intermediary, such as brokersmarket makersInvestment banks or stock exchanges. Such platforms allow electronic trading to be carried out by users from any location and are in contrast to traditional floor trading using open outcry and telephone based trading. Sometimes the term trading platform is also used in reference to the trading software alone.
Electronic trading platforms typically stream live market prices on which users can trade and may provide additional trading tools, such as charting packages, news feeds and account management functions. Software e-trading securities brokers platforms have been specifically designed to allow individuals to gain access to financial markets that could formerly only be accessed software e-trading securities brokers specialist trading firms.
They may also be designed to automatically trade specific strategies based on technical analysis or to do high-frequency trading. Transactions have traditionally been handled manually, between brokers or counterparties. However, starting in the s, a greater portion of transactions have migrated to electronic trading platforms. These may include electronic communication networksalternative trading systems" dark pools " and others.
The first electronic trading platforms were typically associated with stock exchanges and allowed brokers to place orders remotely using private dedicated networks and dumb terminals. Early systems would not always provide live streaming prices and instead allowed brokers or clients to place an order which would be confirmed some time later; these were known as ' request for quote ' based systems.
Trading systems evolved to allow for live streaming prices and near instant execution of orders as well as using the internet as the underlying network meaning that location became much less relevant. Some electronic trading platforms have built in scripting tools and even APIs allowing traders to develop automatic or algorithmic trading systems and robots. The client graphical user interface software e-trading securities brokers the electronic trading platforms website mit binare optionen reich werden software e-trading securities brokers used to place various orders and are also sometimes called trading turrets though this software e-trading securities brokers be a misuse of the term, as some refer to the specialized PBX phones used by traders.
During the period from tothe development and proliferation of trading platforms saw the setting up of dedicated online trading portals, which were electronic online venues with a choice of many electronic trading platforms rather than being restricted to one institution's offering.
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Electronic or scripless tradingsometimes called e-trading or paperless trading is a method of trading securities such as stocksand bondsforeign exchange or software e-trading securities brokers derivatives electronically. Information technology is used to bring together buyers and sellers through an electronic trading platform and network to create virtual market places. Electronic trading is in contrast to older floor trading and phone trading and has a number of advantages, but glitches and cancelled trades do still occur.
For many years stock exchanges were physical locations software e-trading securities brokers buyers and sellers met and negotiated. Exchange trading would typically happen on the floor of an exchange, where traders in brightly colored jackets to identify which firm they worked for would shout and gesticulate at one another — software e-trading securities brokers process known as open outcry or pit trading the exchange floors were often pit-shaped — circular, sloping downwards to the centre, so that the traders could see one another.
With the improvement in communications technology in the late 20th century, the need for a physical location became less important and traders started to transact from remote locations in what became known as electronic trading.
Set up inNASDAQ was the world's first electronic stock market, though it originally operated as an electronic bulletin board [ citation needed ]rather than offering straight-through processing STP. By investment firms on both the buy side and sell side were increasing their spending on technology for electronic trading.
Traders software e-trading securities brokers increasingly started to rely on algorithms to analyze market conditions and then execute their orders automatically. The move to software e-trading securities brokers trading compared to floor trading continued to increase with many of the major exchanges around the world moving from floor trading to completely electronic trading.
While the majority of retail trading in the United States happens over the Internet, retail trading volumes are dwarfed by institutional, inter-dealer and exchange trading. However, in developing economies, especially in Asia, retail trading constitutes a significant portion of overall trading volume .
For instruments which are not exchange-traded e. US treasury bondsthe inter-dealer market substitutes for the exchange. This is where dealers trade directly with one another or through inter-dealer brokers i. They acted as middle-men between dealers such as investment software e-trading securities brokers. This type of trading traditionally took place over the phone but brokers moved to offering electronic trading services instead.
Similarly, B2C trading traditionally happened over the phone and, while some still does, more brokers are allowing their clients to place orders using electronic systems. Many retail or "discount" brokers e. Charles SchwabE-Trade went online during the late s and most retail stock-broking probably takes place over the web now. Larger institutional clients, however, will generally place electronic orders via proprietary electronic trading platforms such as Bloomberg TerminalReuters XtraThomson Reuters EikonBondsPro, Thomson TradeWeb or CanDeal which connect institutional clients to several dealersor using their brokers' proprietary software.
For stock trading, the process of connecting counterparties through electronic trading is supported by the Financial Information eXchange FIX Protocol. Used by the vast majority of exchanges and traders, the FIX Protocol is the industry standard for pre-trade messaging and trade software e-trading securities brokers. While the FIX Protocol was developed for trading stocks, it has been further developed to accommodate commodities,  foreign exchange,  derivatives,  and fixed income  trading.
For retail investors, financial services on the web offer great benefits. The primary benefit is the reduced cost of transactions for all concerned as well as the ease and the convenience. Software e-trading securities brokers -driven financial transactions bypass traditional hurdles such as logistics. Exchanges typically develop their own systems sometimes referred to as matching enginesalthough sometimes an exchange will use another exchange's technology e.
Exchanges and ECNs generally offer two methods of accessing their systems —. From an infrastructure point of view, most exchanges will provide "gateways" which sit on a company's network, acting in a manner similar to a proxyconnecting back to the exchange's software e-trading securities brokers system. Many brokers develop their own systems, although there are some third-party solutions providers specializing in software e-trading securities brokers area.
Some banks will develop their own electronic trading systems in-house, but this can be costly, especially when they need to connect to many exchanges, ECNs and brokers. There are software e-trading securities brokers number of companies offering solutions in this area.
Many types of algorithmic or automated trading activities can be described as high-frequency trading HFTwhich is a specialized form of algorithmic trading characterized by high turnover and high order-to-trade ratios.
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