Oanda Corporation is a brokerage company pioneer in Internet based forex trading and is also well known as a global leader in currency information services. Oanda Corporation is headquartered in New York, U.S.A with a representative office in Toronto,Canada.
When this brokerage company launched FXTrade in 2001, it was one of the first companies to offer a truly automated online currency trading system. Oanda possesses one of the world’s largest and most accurate databases of currency prices. Today it has a very popular online currency converter that handles more than a million queries a day.
Oanda is a Registered Futures Commission Merchant (FCM).It is also registered with the Commodity Futures Trading Commission (CFTC) apart from being a member of the National Futures Association. So its credentials from a regulatory point of view are excellent. It provides both retail and institutional investors a state of the art forex trading platform that has till date executed more than 300 million trades.
Oanda’s stated policy has been to offer its clients a non-discriminatory trading environment with the tightest possible variable spreads. So whether you are an individual or institutional customer, you get the same spreads and that is irrespective of the size of your account or trade size. This is perhaps one of the distinguishing features of Oanda.
Oanda does not require that you have a minimum trade size, and they don’t insist on any specified minimum amount to open an account. Most other sites require a minimum amount as well as a trade to be placed in lots of 10,000 units. With this brokerage company, you can buy a single unit worth 5 cents or a couple of units worth 10 cents, if that is how you wish to trade.
Oanda has plenty of currency pairs to trade, and you can also trade gold or silver if you prefer precious metal trading to currency trading. That apart, you can utilize Oanda’s learning tools, or visit their forum to learn the basics of forex trading. In the forums you will always find someone to help you, and that’s a good way of learning forex trading.
What about leverage with Oanda? Leverage as you know is used to describe the margin requirements. A leverage of 50:1 means for each dollar margin available you can make a 50 dollar trade. Oanda offers a maximum leverage of 50:1 but you could also fix your leverage at 40:1, 30:1, 20:1, or 10:1, although it is better to keep your leverage at 20:1 or lower. Many other brokers may offer 100:1 or even 200:1, but these levels are far too risky and if you are not experienced, you could loose your funds very quickly with this kind of leverage. As Oanda offers the maximum leverage of only 1:50 that would certainly make you have overall discipline in your trading activity.
FXTrade is Oanda’s trading platform and is JAVA based. So it doesn’t quite matter which operating system you are running, that is whether Windows or Mac as they are good on both accounts.However you will require Java 5 or higher to be installed in your computer for this trading platform to work.
There are no trailing stops in the platform but that’s not reckoned as a big problem. The indicators on the Oanda platform leave a lot to be desired. So is their charting, which could have been better. But the news feeds in the Oanda platform are pretty good.
Oanda trading platform calculates interest rates by the second, and this happens on a 24-hour basis. Usually other brokers apply interest rates once a day for any trades that may be open at that time. But with today’s Internet technology, forex markets can make quick matches between buyer and seller, so it makes sense to calculate interest every second and that’s exactly what Oanda does.
FXGame is the practice version of FxTrade. Using Fx Game you can trade under real market conditions with real prices and spreads, for as long as you want. Unlike other sites, Oanda offers FxGame as an unlimited practice account. Other brokers offer demo accounts only for 30 days, after which time they cancel your demo and expect you to make deposits to start actively trading. But this is not so with Oanda. You can practice as long as you want.
You cannot do hedging with the same currency pair on the Oanda platform but you can do hedging in a sub-account. So what you get in the Oanda platform is low variable spreads (which could be typically 0.9-1.9 pips for EUR/USD under normal conditions), fast trade execution, real time executable pricing and you could trade any amount you want, and start with as little as $1.
Customer support is provided by email, chat and telephone. They are extremely responsive to requests for customer service and you could say it is adequate but not that great.
Site design is excellent and that enables you to take full advantage of various resources in the Oanda website.
A significant advantage is you can get a demo account that is identical to the real account even in receipt of price feeds and other characteristics, and you can keep using it for an indefinite period. From the point of view of a beginner that is indeed a good facility to have.
As there is no specified minimum amount required for opening an account you can start off with any amount you have. There is no minimum lot size either so it’s good for beginners.
When economic news releases are made in forex markets, the currency spreads in the Oanda platform tends to go up sharply.
Another problem with Oanda is that, you have to pay them a withdrawal fee to pull out your money when you make profits or otherwise.
But when you look at Oanda in totality, it’s a truly an exceptional service.