Most traders rely heavily on software for helping them to understand markets and investment opportunities. There are now so many software vendors and applications that it is difficult to tell them apart, let alone choose one application from another. Every one of these companies wants to be the next Bloomberg and they exploit the subscription model for getting traders to pay them monthly service fees. Rarely can traders buy trading software outright anymore.
In this ongoing series we will get under the hood, so to speak, and look at individual apps and app classes as a whole. We’ll start by evaluating FXCM, also known as Forex Capital Markets, maker of popular foreign currency exchange trading software, and a registered broker.
Why did we start out with FXCM? It’s because FXCM looks to have the best solution for foreign capital market trading and the company didn’t pay us to make that assertion. As a total solution and Forex trading ‘’platform’’, FXCM is pretty darn good. The extent of the education, resources, information, trading control and support offered by FXCM is, indeed, extensive. We are in no way slanted or motivated to make such an assertion. In future articles, we’ll give other Forex trading software vendors to share their solutions too, but since we’re going to be talking about software we might as well start out with the perceived industry standard.
Before we begin, I need to declare that the last thing you want to do is to allow your software to do your thinking for you. Your trading software is not your brain. Many traders get so dependent on their software that they stop thinking. This is a recipe for financial disaster. Your trading software should be perceived as a tool, nothing more. You should be able to read charts and understand markets without the crunch of trading software. That may not be easy for most traders to accept, but it’s the truth.
While most software vendors have rapidly transitioning to a subscription based model of application delivery, the primary agent of change has been the Internet where the browser has made ‘’software as a service’’ a reality. Investing software is no stranger to the model pioneered by Bloomberg where real-time market data is essential to making timely and accurate trades. But for years, Bloomberg delivered its data through dumb terminals. It was like sitting in the coach’s box. You weren’t on the sidelines. Today, traders are not only on the sidelines they are in the game with solutions like FXCM.
This means that when you open an account through the FXCM website, your trades are processed in real-time. This gives you unparallel control over your own money. In essence, FXCM becomes for your Forex broker. With 24 hour, 7 day a week customer service, support is critical. Everyone needs help from time to time. Although after hours customer service is conducted through online chat through a browser with my guess being the people on the other end of the keyboard are stationed in India or the Philippians, when I tried out the company’s chat service, I found them to be courteous, fluent in English in both grammar and spelling, and extremely helpful. The customer service is also multi-lingual, so whatever your language they speak it.
As I mentioned, no trading software or broker should give you an excuse to stop thinking and learning and improving your skills at making money through trading. It should also be mentioned that no one trading system or software will be a 100% answer to your trading needs. As extensive FXCM is for day traders, it too will not do everything for you that you want or need it to. If you’re looking for the Holy Grail in a trading platform or brokerage you’re not going to find it.
It should also be mentioned that if you choose to learn more about the FXCM trading platform, please be careful before opening a new account with FXCM. The minimum requirement for opening an FXCM trading account is $2,000. That’s not a fortune, but once you make a commitment to a trading platform it’s a good idea to stick with your decision.
Choosing software is different than choosing a Forex broker. Since brokerage firms these days have also become software vendors, many traders get seduced with the software without evaluating the brokerage firm. FXCM is a healthy and financially stable company regulated by four governing agencies. FXCM is one of the largest Forex Dealer Members according to the CFTC, and is also one of the largest non-bank FCMs (Futures Clearing Merchant). Traders outside of the U.S. can operate regulated accounts in the major cities there Forex trading is permitted.
FXCM has been in the game for over 10 years and they are well capitalized. (They don’t appear to be like some U.S. banks that take your money and run and then wonder to themselves where your money went.) The company’s liquid assets near $100 million.
FXCM has done so well that they have expanded with offices in London, Dallas, San Francisco, Hong Kong, and Tokyo. The company is based in New York City. Over 100,000 clients call FXCM broker. In addition, over 400 institutional client in 80 countries use FXCM.
When it comes to transactions, just like most brokers, FXCM is a commission free trading platform. Spread and execution is competitive even in dramatic market situations where broker execution quality is reduced.
The company offers several trading platforms which include it’s cornerstone FXCM Trading Station, and also level 2 Web-based trading solutions. Their trading platforms are rich with valuable data kept current by a large research team which publishes daily market advisories to keep you informed and buzzing with good ideas. FXCM manages a market research website at www.dailyfx.com, and if you open a live account with FXCM you’ll be able to access a wealth of valuable research data through dailyfx.com which include charts, recommendations, trends, signals and hot news.
Overall, FXCM is a winner. When you visit the FXCM website at www.fxcm.com, you can see that this isn’t just a software vendor, and its not just a broker either. FXCM puts the platform in trading platform. Now all you have to do is dive.
About FXCM, The Company
FXCM has been awarded Best Retail Platform by FX Week in 2004, and also recognized as Best Currency Broker by both Shares and T2W Member Choice Awards in 2004, and also Best FX Specialist by Stocks & Commodities in 2002, 2003, and 2004.
FXCM is a registered Futures Commission Merchant (FCM) with the Commodity Futures Trading Commission (CFTC) and is a member of the National Futures Association (NFA). Ownership and regulatory information on FXCM are available at its National Futures Association (NFA) listing.
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