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How to Spot the Perfect Stock Charting Software
By plrprousers | March 29, 2010
Do you need stock charting software? The answer isn’t as simple as you think. Depending on your trading style and preferences, you may be the type of trader who can work better without using software. It is a fact however, that for many trading systems specialists, software is invaluable.
It is a fact that following a trade plan or system is perhaps the most important decision you will ever make. It is also a fact however that an outstanding system will amount to nothing if you do not use it in conjunction with the right tools. Charting software for trading is just one of these tools. At the very least, your tool can help you create charts for your reference. Most trading charts however are meant to do so much more than that. With a good program, you can quickly scan through countless securities and pick out those that match your criteria.
The only issue with picking and utilizing chart tools is the abundance of options. This is why it is crucial to identify certain elements, components or traits that you would like to find in a charting package.
The first major quality of a good software tool is longevity. Pick one that has been around for quite some time. This quality will give you some assurance that the stock charting software is stable. Moreover, the fact that it has been around for long is an indication that it is likely to stick around for even longer. You don’t want to have to take a lot of time and effort learning how to use it only for it to become useless the next day because support has been pulled out.
Having a huge user base is also a good quality. Aside from program manuals, actual users can give you good insights, tips and advice about using a tool. This is especially since many serious users of charting software take the time to unlock program secrets that aren’t always indicated on the manuals. In short, the more users there are, the more help you can get for questions that you can’t find the answers to.
Flexibility is the third crucial trait to look for in a tool. Some are categorized as black box systems. You can use these straight out of the box without too much effort. In most cases though, these cookie cutter systems aren’t worth a cent simply because they leave you blind to what is really happening behind the curtains. It is incorrect to believe that an automated system can do all the hard work of raking in big profits. Stock charting software should give you enough room to define your own criteria.
One other important feature is back testing compatibility. Before you execute any system, it is important that you know beforehand that it is likely to work by having it tested. Some packages have recommended testing facilities associated with them. The best programs however are those that permit the use of third party testers. This will give you more options in case you aren’t satisfied with the default recommendation.
It is entirely your decision to go for paid stock charting software or not. If you aren’t certain whether you need one or not, you should at least take the time to find out.
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