Many people do not know the difference between OTC or over-the-counter CFDs and DMA or direct market access CFDs (DMA CFDs), before I commence it's critical to make sure that the distinctions between both varieties of Contracts for Difference are clearly explained as you'll find significant advantages and disadvantages of each type that all traders should be aware of.
Understanding the differences between the two types of CFDs is relatively simply explained. In essence DMA CFD companies permit all of their customers CFD trades to flow onto the underlying order book of the share over which the CFD is based, this permits DMA CFD traders to take part in the market depth a have their trades partly filled in addition to permitting the trader to be a price maker rather than a price taker, OTC CFD providers on the other hand often match trades against another clients order or their internal liquidity instead of placing the order in the underlying market. OTC CFD brokers have the advantage of having the ability to offer CFDs over indices and forex and tend to be more suitable for traders seeking to access numerous asset classes, whereas DMA CFD companies are only able to offer CFDs over stocks and are better suited to those looking to trade stocks on leverage or Contracts for Difference over small cap stocks.
Now that you realize the difference between both sorts of CFDs on offer it is critical to understand the trading platforms available. As CFDs are traded on-line it is essential to make sure that you choose the right trading platform that fits your trading style, the most popular DMA CFD platform is webiress plus.
Webiress plus is the fastest and most reliable DMA CFD trading platform available on the market today. Webiress plus started out it's life as a share trading platform and soon after was custom-made for CFDs. The platform is web based and uses java, like all java applications it's critical to make sure that you've got the latest java version running on your computer to be able to experience the great functionality of the software.
Webiress plus can be very overwhelming for beginners first starting out however once you appreciate the power of the application it is doubtful that you'll use anything else. Configuring your first layout can often be the most tricky part however this is fairly simple if you stick with the essentials. Among the vital features of webiress that it is best to setup to display permanently on your trading platform workspace are a watch list, your portfolio, an order pad, a market depth window and of course the market map. Having these features open on your workspace are key when you first start out and can prevent you from making some common and easily preventable mistakes like not knowing whether or not an order has been canceled or not.
Let's now check out the importance of each of these important webiress plus features.
Watch list
Having a watch list window open is essential when you are CFD trading as it lets you monitor the CFD positions that you have open as part of your portfolio and any others that you could have an interest in opening positions in. The watch list will enable you to observe prices without the necessity to have many price windows open.
Portfolio
The portfolio window is arguably an important feature in webiress plus as this allows you to observe the essentials of your portfolio including your free equity, margin requirements, portfolio worth in addition to both your realized plus unrealized profit and loss. In the portfolio window you will also be able to observe your open positions, see your average price, market to market value and unrealized profit or loss on each individual position.
Order Pad
Using the order pad window is essential if you happen to be managing multiple orders, the order pad window lets you track the status of your orders in the market. After placing an order using webiress plus it is critical to check whether the trade has successfully reached the market, this can be done using the order pad, it is from here that you will also have the ability to check for incomplete fills and confirm the status of trade cancellations.
Market Depth
Having access to market depth is vital when buying and selling DMA CFDs as this will permit you to see your orders in the underlying order book of the equity over which the CFD is based, not only will you have the ability to see your orders in the depth but you will also be able to see where support and resistance levels are by simply looking to see the quantity of buyers or sellers in the market at each price point.
Market Map
The market map is one of the distinctive features of webiress plus, it provides traders with a visual analysis of the whole market in a glance. It is common for traders to utilize the market map feature to help them to pinpoint equity CFDs who's prices have either risen or fallen dramatically across the whole market. The market map is also able to display the market capitalization of equities meaning traders can rapidly filter out stocks in a particular sector which may not meet their investing criteria.
Now that you are familiar with the distinctions between DMA and OTC CFDs and understand a few of the main features of the webiress plus trading platform you are well on your way to CFD trading. Before you begin trading DMA CFDs on webiress plus it's important that you practice using the platform, place various orders and set up a trading workspace that fits your trading style. You can access a free webiress plus demo from leading CFD company IC Markets web page that you're able to practice on for as long as you like.
Author Resource:
Marcus Murphie has been using the webiress plus trading platform for many years. Marcus uses many of the features of the trading platform including the market map in his trading approaches, he has also written many books and guides on DMA CFDs and their benefits for frequent traders. If you would like to read more about DMA CFD trading using the webiress plus platform you'll find allot of practical hints on IC Markets blog.
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