- Day trading software is designed to supply an investor with data regarding specific securities. It then gives a user the ability to chart that data to analyze the security's performance, which helps him make decisions about whether to purchase or sell that security. The investor can then execute an immediate trade using the software. Since this system is up-to-the-minute, the trade is nearly instantaneous.
- A variety of companies facilitate the process of day trading. Most of these applications are found online in the form of fee-based websites or in downloaded applications that operate with an online feed. The software is available as individualized components or as fully-bundled packages. Different companies specialize in different facets of the software, such as data feed applications or charting programs. Many of these companies have merged their operations in recent years to provide more comprehensive day trading packages for consumers.
- Although day trading as a concept has been around for years, day trading software was first introduced in the 1980s with large trading houses and brokerage firms. Through the 1990s and the introduction of the personal computer into the average American's home, day trading software became a common tool for those interested in stock trading without a broker. Many more Americans became interested in the practice and utilized the tools. By the first part of the 21st century, day trading software had revolutionized the way securities were traded. No longer was the stock market limited to a person's 401(k) or highly paid traders on Wall Street. Companies like Interactive Brokers became popular with a variety of clientèle, allowing many more people to work with day trading software.
- Day trading software is divided into three main categories: data, charting and trade execution.
If a day trader needs to know the statistics and price of a stock, future or currency that they would like to trade, they receive their information from a data feed. The prices are sent from the exchange to an aggregation company which, in turn, sells the information to a company that supplies the investor.
Charting involves the tracking of a specific security and analyzes the performance. Charting software can use various graphs to illustrate the performance of a specific stock.
Trade execution software is proprietary software that is linked to a brokerage firm. This allows a day trader to inform a third party of his or her trade and that third party then facilitates the trade. - There are many day trading software companies that provide advice to investors about which trades to make, who to watch and which sector of the market is the best. This advice can be supplied by either the day trading software company itself or a third party that uses its investment knowledge to inform their client. Some of these services are provided by professional investors who have made a living on the stock market for years. Customers of these sites believe that this investor's experience and knowledge is worth paying for. These sites are usually subscription based and provide a potential day trader with emails or up-to-the-minute information about the market.
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