Last updated on October 19th, 2020
Trading is a business and like many businesses, you need tools to help you in your business. If you are a Futures trader, you have no doubt looked into Futures trading software and wondered exactly what it is you require.
The trading software you will need will depend on what type of trader you are. Swing traders may need different trading software than a scalper.
Assuming you have the basics such as the best trading platform and order entry programs covered, I want to touch on a few pieces of software and services you may find useful for not only Futures trading but any market or instrument.
These are not endorsements but are gleaned from the many traders I speak with on a weekly basis.
Data Feed For Futures Trading
If your trading strategies call for intra-day trading volatile markets such as crude oil futures, you will want to ensure you are trading with an extremely reliable data feed.
While data is not futures trading software per se, without it, other important trading software would be useless.
Kinetick– Many of the traders use the Ninja Trader trading charting software for futures so this is no surprise. Quotes are not sacrificed for unfiltered delivery speed so the price you are getting is straight from the exchange. When trading fast markets, the last thing you want to worry about is the quality and speed of your price quotes.
Their price point is in reason compared to other data companies. Data feed is not a glamorous topic however speed, reliability and costing are variables you should keep in mind.
Just as you turn on the light at home and expect a constant stream of electricity, you should expect the same from you data provider.
On the topic of backtesting, ensure your data feed has enough historical data to allow a large sample of market conditions to test. Kinetick offers 180 days of tick data, 2 years of minute data and 10+ years of daily data. That may be enough to give you a solid glimpse into the viability of your trading plan and system if you are interested in trading futures for a living.
Breaking News Software
What if your futures trading strategy relies on up to the minute news and insights to help define a trade setup?
How about software that allows you to monitor and analyze many different securities at once?
One very powerful piece of future trading software for traders is:
Bloomberg Terminal– A trader I know that trades for a fund said he would not turn on the charts until Bloomberg was fired up. That is how important this trading software is to his business.
Global coverage is their hallmark and while they produce their own content, they have 1000+ other news sources plus the ability to harness the power of social media for instant and in the moment news broadcasting.
We’ve all seen how a misplaced word from a govt leader can affect the market to the tune of 400 points in a hearbeat. Fast delivery of news content for those whose futures trading strategies rely on news and errant spikes to be effective is vital.
Economic releases can shake the market and having the important releases front and center and the results of the release can be an exceptional asset to certain types of traders. I personally know a trader who will only start trading when a highly volatile releases such as NFP (Non-Farm Payroll) occur.
You can imagine that having up to the second information on these events is part of his trading edge.
Tracking the main markets such as Dow, S&P, NASDAQ, and even gold futures can help traders have a birds eye view on the risk on/off situation for the trading day.
It does come with a cost and this type of software for futures trading may be out of your reach. There are many benefits to the investment that will all depend on your goals and how much overhead you want to have.
Trading Automation Software
Automated Futures Trading Software – Whether you are trading oil futures or your business is e-mini futures trading, this type of software can do much of the heavy lifting for you.
If you have done any trading at all, you know the battle you have with your trading emotions. Paper trading (demo trading) can sometimes give you an insight of the greed/fear emotions but nothing takes the place of live trading with actual money on the line.
Automated trading software can do everything from locating and triggering trades to trailing and exiting your positions.
There are two huge benefits to this type of software:
- No emotional trading – It’s a mechanical strategy that has been tested out over time. When variables line up, the trade is triggered regardless of your personal bias. If you were starting at your trading charts, you may find reasons to sit out “this trade”. You may decide to lighten up the position.That brings me to the Turtle Traders and the heating oil example. Only 1 trader, Curtis Faith, followed the trade plan and reaped a windfall for his mentors. The others found reasons to not follow the plan and paid a hefty price for doing so.Objective trading at its finest is what this type of trading software can do for you.
- Have a life outside of trading – Unlike the standard approach to futures trading, you don’t have to be glued to your computer screen out of fear of missing a trade. Since markets are basically in play 24 hrs a day, your prime setup may occur while you are on vacation or sleeping. Automated software is online around the clock ready to execute your backtested and proven trading plan.
This is just some of the trading software that is available for those interested in trading futures. Software also comes with different qualities and price ranges so ensure what you are using is aiding your trading…not hindering it.
Even those that make their living currency trading online can benefit from employing a strong data feed, news wire and automated trading programs.
For those traders that love the “thrill” of day trading, they can still utilize the automation in regards to trade management or even locating and entering swing/position trades. Anything that helps us stick to our trade plans and protect our trading accounts is always worth consideration.