Online trading

7 Point Checklist Before Downloading an Online Trading Platform in Australia

E-commerce in Australia by retail traders has increased significantly over the past few years, particularly during the pandemic. Many young people actively trade stocks, derivatives, etc.

But not all trading platforms are the same, and many platforms are not even regulated. So, there are some factors to consider before downloading an app or platform from an online trading broker in Australia.

These factors are very important because a person’s trading platform can make or break their trade, regardless of their level of expertise. This can harm your trading experience and spell the end of your investment.

Many Australian brokers offer their own proprietary trading platforms to their clients. However, some use a third-party platform like MetaTrader or cTrader. Either way, this guide intends to provide e-commerce traders in Australia with the necessary boxes to check before downloading an e-commerce platform.

#1 Platform Security

This is perhaps the most important factor to consider before downloading an online trading platform. This is to prevent one from carrying out transactions with an illegal or unregulated platform.

In Australia, ASIC regulates the financial services industry and brokers must obtain an Australian Financial Services License (AFS) from ASIC.

For a broker to offer financial services and offer a trading platform in Australia, that broker must be licensed by ASIC.

In a situation where the online platform is not authorized by ASIC, it is an illegal platform and those who use it do so at their own risk. If a broker is ASIC regulated, it offers protection to clients against any form of fraud or illegal behavior on the part of the broker.

It also guarantees that the broker offers products that comply with the rules and regulations set by the Australian government through the Australian Securities and Investments Commission (ASIC). The Australian regulator is constantly monitoring market participants and brokers to implement new rules/restrictions if necessary, for the protection of investors.

For example, in the case of ASIC regulated Australian forex brokers, there are strict restrictions on leverage on CFDs for investor protection, these limits were introduced in October 2020, when it was Investors noticed $774 million in CFDs for 5 weeks from March to April period, due to the use of dangerous leverage. After the ASIC intervention, losses for retail CFD investors were significantly reduced from $372 million to $22 million in one quarter.

While an unregulated broker is not required to follow the rules set by ASIC which are there to protect traders and would still provide a dangerous trading environment by offering unlimited leverage to clients and operate without any protection of investors.

It is therefore important to ensure that the platform you are trading with is regulated.

#2 Platform Security

In any financial transaction, security is of utmost importance. This not only ensures security of funds but also other valuable private data such as credit card number, date of birth, etc.

When choosing an online trading platform, you need to do a background check on the security of the platform. Do they have a powerful firewall? Is your data safe with them? Has the trading platform ever been hacked? Do they have a data backup system in the event of a crash? Does the platform allow two-factor authentication?

These and other more relevant questions should be answered before downloading the trading platform to your device.

#3 Ease of use

Here we take a look at the user interface and user experience of the trading platform.

The level of convenience of using the trading platform should be considered before downloading it. You need to check the platform language whether it is Australian English or can be set to Australian English. Also, you need to check whether it is fast or slow on your device, how much memory space it will consume, etc.

Consider downloading their platform and signing up with a demo account to test whether you are able to use this platform easily or not.

A good online trading platform should also have easy to understand charts and graphs, adequate trading tools, indicators, etc.

Before downloading and registering on the trading platform, all of these should be checked as they help to make the trading process smooth for everyone.

Your trading experience may not go as planned if the platform is not a perfect fit for you or your device. It may cause losses for you if you cannot use the platform easily because you may not be able to use the features you want.

#4 User Reviews on App Store or Google Playstore

Before downloading a trading platform, you should check out the testimonials of those who have used or are currently using the platform. These reviews can be viewed on the Google Playstore or the App Store where it was downloaded. These reviews let you know about the trading platform, how it works, how effective it is, etc.

This knowledge will guide you in the decision to continue downloading the platform or looking for others. These reviews also reveal likely problems with the trading platform and how you can avoid them, or whether you should choose another platform.

#5 Cost

While some platforms must be purchased, i.e. they are paid, others are free.

This should be a major consideration before downloading the online trading platform. You should also check if there are any commissions for using the app or any fees you need to pay. It is important to check all of these items so that you are not caught off guard when you start receiving deductions.

For example, some brokers have a partnership with Tradingview, which is a paid platform used by many traders in Australia. If you want to trade through the Tradingview platform, you should check whether your broker supports it or not, and if there are any additional fees for using it.

#6. Customer service

During the use of the online trading platform, it is very likely that you will encounter some problems. Customer Support is intended to provide answers to your questions and resolve any issues you are likely to encounter.

It is advisable to try to test the customer support of the platform you are considering downloading to determine if it is fast, reliable and suitable for you.

You should try the language whether it is Australian English, communication options whether it is an Australian phone line, email options and live chat.

All of these considerations are important if you want to have a seamless experience on the broker’s platform. You should also test the response speed to see how fast they respond to queries.

#7 Beware of scams

Last but not least, beware of fraudulent trading platforms.

These scams can range from cloned apps to similar websites and so on. To avoid this, make sure you download your trading platform from the right source and not from a third-party source.

You also need to check the number of downloads and confirm the logo on the app before downloading. For websites, be sure to confirm the website URL to see if it matches the broker’s actual website listed in the regulator’s public registry.

Don’t ignore any red flags

Finally, remember that it is really important to check everything carefully before deciding to put your money in a brokerage account. There are many fraudulent trading platforms, and you have to be very careful.

These considerations should only be the start, as there are many other things to check.

Remember that trading involves many risks, including loss of capital, fraudulent platforms, instrument risk (as many instruments are derivatives, which are very risky). You must understand the risks before proceeding.

Consult a registered financial adviser before making any decisions.