Forex oanda 1

OANDA Review 2021: Fees, Services and More.


Do you want to convert currencies? Would you like to learn about historic exchange rates or transfer money internationally? Most importantly, would you like to invest in foreign currencies to boost your portfolio’s performance? OANDA advertises itself as the place to do all of these things. Whether or not it’s the go-to place for currency conversion, this platform does offer a solid, if not particularly inventive, option for currency trading online.


Currency investing is best begun with the insights and guidance of an experienced financial advisor.


Services & Features: What Does OANDA Offer?


OANDA is a feature-limited trading platform. This means that only offers certain assets to trade. Specifically, investors on this platform can only trade foreign currencies (forex). They will not have access to common asset classes like stocks, bonds, ETFs and mutual funds. It is also noteworthy for accepting U.S. clients. Many global currency marketplaces aren’t regulated by U.S. authorities, and so aren’t available to American investors.


The limited nature of OANDA as a platform means that it is best suited for committed investors. This is a specialized tool. You will need an additional trading platform to manage the bulk of your investment portfolio, as OANDA does not offer standard assets.


As noted further below, OANDA also does not offer an especially well designed trading platform. This is particularly true of its web client, which is unfortunately cluttered and unintuitive.


As a highly technical field, currency trading requires a wealth of highly specific information. OANDA meets this need well. Investors can access dozens of technical indicators ranging from Bollinger Bands to Volume Oscillators, and have access to a full range of charting tools for displaying this information. You can build this information directly into pricing charts or align them alongside depending on what works for you. However, this is an area the platform’s design limits become increasingly to manage. The tight interface makes it difficult to fully use OANDA’s various technical indicators and visualization tools. The screen quickly becomes crammed with information, making it difficult to actually follow the many data points that you can summon up.


OANDA offers basic trading options and investors can pull up their trade execution screen directly from pricing charts. Within this field you can choose basic limit and stop orders, as well as stop limit and take profit orders. This is a standard set of options. Unfortunately, OANDA does not offer some of the more complex trading orders that many other forex platforms support, such as conditional and intelligent orders.


Finally, OANDA has an outstanding set of educational tools for both learning about the forex market and conducting fundamental analysis. While none of these tools are available from within OANDA’s trading platform itself, you can click basic links from within the platform to access them. This is particularly true of Market Pulse, an extensive site dedicated to news and education on the subject of currency trading, as well as the OANDA newsfeed.


Fees: How Much Does OANDA Cost?


From the user end side of things, there are largely four types of fees to look out for:


Trading fees. Any form of fee attached to each trade that you make. This can (relatively rarely) come in the form of a flat fee, or more often the broker will charge you what’s known as the spread. This is the difference, if any, between the buying and the selling price of an asset. Trading commissions. This is when a broker will charge you a percentage based on the volume or value of each trade. Inactivity fees. Any fees that the broker charges you for not trading, such as if it charges you for keeping money in a brokerage account. Non-trading/Other fees. Any form of fee for trading on this platform not covered above. For example, a brokerage might charge you for making deposits into your brokerage account or taking money out.


When trading currency, it is essential to understand the concept of “pips.”


Pips are a shorthand used by traders in several different financial sectors. A single pip refers to the smallest amount by which prices of an asset can change, regardless of that asset’s class or market. In foreign currency markets, prices are almost always expressed out to four decimal places. This means that a single pip will mean 0.0001 (1/100 of 1 percent) in whatever unit of currency is being traded. This can also be referred to as one basis point.


Note, however, that a pip does not always have to mean 0.0001. A pip is defined as the smallest unit of change for a given asset regardless of how that unit is measured. If, for some reason, a particular asset were measured in tenths of a cent, then a pip would mean 0.1.


As is common with forex trading platforms, OANDA charges a per-trade commission based on the bid-ask spread. This can make pricing difficult to pin down given that the spread on any given pair of assets is in constant fluctuation. Common currency pairs will also tend to have lower spreads than uncommon ones. The upshot is that what you pay on OANDA, as with any currency site, will depend on what you trade and when.


OANDA offers two account models with different pricing structures. Its spread-only model has higher bid-ask spreads, and investors only pay those commissions. You can also open a core pricing account. This model offers much lower spreads but also charges a flat commission of $5 per 100,000 units of currency traded. (Investors who are new to currency trading should take note of the volumes at work here. This is the scale at which currency traders have to operate in order to make a profit.)


As with all forex trading sites, OANDA charges an interest rate on any positions held overnight. The platform also charges an inactivity fee after 12 months of no trading, calculated as 10 units of the account’s base currency. Finally, OANDA has a list of ancillary fees that attach to making deposits, withdrawing money and several other common activities.


Effectiveness: How Well Does OANDA Work?


From a review standpoint, OANDA is essentially a conflict of design vs. function. OANDA offers everything a currency trader might want in a standard platform. Its educational tools and fundamental analysis options are outstanding, and investors who are looking to make bets based on factors such as economic conditions and news events will do well to look here. You can build just about any standard position and technical trader will not want for data to analyze.


That said, functionally OANDA doesn’t really offer anything you haven’t seen before. Its technical indicators are thorough but it offers no new features in terms of data or data analysis. It does not have options for building smart orders, and in in fact the platform generally has no features that will surprise you. In an era where currency trading platforms are pushing the boundaries on how to creatively invest, this kind of originality is notable in its absence.


In addition, the design of OANDA’s platform leaves much to be desired. The best word for this platform’s interface is “cramped.” Data piles on top of itself when you try to build charts for technical analysis, and unnecessary windows compete on the screen for space. Lining up two currencies side-by-side reduces the information in both windows considerably, and even the tool for buying/selling assets quickly gets lost in the jumble.


These design flaws are particularly a problem given OANDA’s lack of functional creativity.


Bottom Line.


OANDA is a dedicated forex trading platform. It is a serviceable product and works perfectly well, but interface design issues and a lack of innovative features mean that it doesn’t stand out in a crowded marketplace. However, investors who particularly rely on fundamental analysis may want to consider it.


Tips for Investing.


Forex is a risk, there’s no question about that, but sometimes you want to take some risks with your money. SmartAsset’s matching tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now. Since currency trading is one of the riskier types of investments it’s important to keep close tabs on how much of your portfolio goes into such trading. A free, easy-to-use asset allocation calculator can be immensely helpful in keep your investments balanced.


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