The stock market got its start in 1817. Since then, it’s come far. Before the use of computers, stock exchanges occurred at physical locations.

Traders would gather in pits to purchase or sell securities with an open outcry. During the day, the traders would write in their journals all the trades they made settling up transactions. This is a system that stated the same until 1971 with the NYSE when the first electronic stock market was introduced.

Since this time, physical trading has disappeared, replaced by electronic trading, orchestrated with help from TradeZero, and similar trading tools. The introduction of the internet made data much more accessible and it opened the industry to new technology. Trading software is invaluable for trading on the stock market, and some of the reasons everyone should use it can be found here.

1. Trading Software Offers Flexibility

Trading software is both flexible and customizable. It lets the user change and customizes their charts. Rather than having to continue updating by using a website, the software lets a user start right back up where a person left off, which also helps to minimize mistakes and issues.

2. Minimize Emotions in the Trading Process

One of the most appealing benefits offered by using an automated system for trading on the stock market is that it helps to minimize the emotions in the trading process. It has been observed that many people lose money in the stock market if they give in to their emotions when they should avoid doing this. It’s much easier for traders to stick to their plan by making sure their emotions stay in check, and the automated trading system will make this possible.

With software, it’s not possible to change trades when they are executed automatically. This helps traders who may be afraid to cut their losses. It’s also beneficial for those who tend to sell or buy when any opportunity arises.

3. Back-Test the Trading Strategy

With the right stock trading software, traders can easily back-test the trading strategy they are using. The process of back-testing means that the rules are applied to historical data to determine how viable a certain trading strategy is. Because the automated trading system won’t leave any room for interpretation, the rules have to be met to execute the trade, which means that traders have the ability to test their strategies based on historical data.

With this ability, traders can test strategies they have developed before risking any of their actual money with live trading. It can also help a trader fine-tune their trading strategies to get an idea of what they may win or lose. By using this feature offered by trading software, it’s possible to mitigate the risks of this risky process.

4. Avoid Cases of Broker Bias

The situation of broker bias occurs when brokers provide their clients with financial advice that is based on what will benefit them (the broker). For example, the broker may receive a commission if they are selling a specific product, such as a mutual fund. When purchasing a product, seller bias is pretty much expected.

For example, for someone who wants to purchase a vehicle and is trying to make a decision between a Ford or a Toyota, they know when they go to one dealership or the other that’s the vehicle they will be sold. However, when using the services of an investment firm, the same awareness may not be present.

There are many brokerage firms that have received citations for several biases all the way to base abuses. There are some that function just like a supermarket where they put the very best “shelf space” aside for a firm that pays the most to have this privilege. This means the investment vehicles offered aren’t always best for a client, which is something that can be avoided when trading software is used.

5. The Ability to Monitor Investments Made in Real-Time

By using trading software, a user has the ability to use a product that meets their needs. The fact is, there are many software options providing users with impressive tools offering valuable information that will ensure they can make the most of their trades. When online software options are used, trade information and stock quotes are available so it’s possible to see how the investments are doing in real-time.

For the past 90 years, the S&P 500 has seen an average return of approximately 10 percent. However, the majority of investors aren’t making that much. The main reason is that they can’t manage several investment accounts and they don’t have the tools necessary to monitor the investments in real-time.

By using online software, it’s possible to see how investments are doing right now. It also lets a trader see the changes they should make to improve the outcome. This is an invaluable asset that will help ensure a person is making decisions about trading based on the current state of the stock regardless of whether the decision is to buy or sell.

6. Lower Fees

Another benefit offered by online trading is the significant reduction of fees and costs compared to trading with the use of a brick-and-mortar firm. Also trading stocks is also something that is time-sensitive. With trading software, it’s possible to execute trades right away.

If someone is working with a brick-and-mortar broker, it requires time to set up an appointment online or over the phone. This is necessary to initiate the trade. When this process is finished, the factors that were appealing and encouraged the trade may have changed.

Is Trading Software a Smart Option for All Traders?

As anyone can see, the use of trading software is a smart move. It offers several advantages that working with a broker or brokerage firm can’t compete with, making it a viable option for both new and seasoned traders. Make sure to research the software options, features, and tools included to find one that suits the needs of the trader and will help to ensure the desired outcome is achieved.