OANDA guaranteed stop loss
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What is a guaranteed stop-loss? A guaranteed stop-loss order, or GSLO, works the same as a standard stop-loss order, but for a small fee, it guarantees to exit a trade at the exact price you want, regardless of market volatility or gapping. When market conditions are very volatile, market gapping (or slippage) can occur, which can result in your stop-loss order being triggered at a different price to what you have set. Therefore, using guaranteed stop-loss orders is recommended for regularly volatile markets that experience large price fluctuations.
OANDA, co-founded by Dr. Stumm and Dr. Olsen in 1996, advertises that it does “all things currency,” from currency conversion to providing FX data services for businesses to offering an established global online brokerage service to individuals seeking to trade the retail FX and CFD markets. Globally, OANDA offers two account types, standard and premium, and a product catalog that includes a wide range of CFD and spread betting offerings across a variety of asset classes, although all are not available in every region that it services. In addition to FX, the broker also offers indices, metals, commodities, and bonds to provide trading opportunities across financial markets. OANDA offers most clients varying degrees of account protection depending on the region. OANDA Europe Limited offers ESMA-mandated negative balance protection, while OANDA Asia Pacific Pte Ltd. offers guaranteed stop loss orders. U.S. clients are the exception as OANDA Corporation does not offer their accounts any such protections. In the U.S., OANDA ranks among the top in the CFTC's Retail Forex Obligation report which "represents the total amount of funds at an FCM, RFED, or FCMRFD that would be obtained by combining all money, securities and property deposited by a retail forex customer into a retail forex account or accounts, adjusted for the realized and unrealized net profit or loss." A well-organized website with a stated goal of transparency, emphasis on client education and research, multiple user interfaces, and global regulatory oversight place OANDA in the top tier of online forex brokers.
OANDA offers clients exposure to a variety of financial instruments but is a good fit for seasoned traders looking for a stellar desktop trading experience. Product offerings vary by region. For example, U.S. clients can only trade FX, but the broker boasts fast and reliable trade execution, research resources that are above industry norms, functional user interfaces, and a verifiable track record of regulatory oversight.
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OANDA, as is the norm in the brokerage industry, generates revenue via the spread that is offered to the client. Its spread structure is quite simple and consists of two pricing options, “spread only” and “core pricing + commission.” The former generates revenue through customer trades that "cross" the bid/ask spread while the latter adds a base commission of $50 per million to the raw spread, which is on par with industry standards. Commission charges are aggregated and posted to client accounts as cash adjustments. These pricing options are easily found on OANDA's website(s) and are available for both account types that the broker offers, although the shown spreads will vary. For example, the minimum EUR/USD spread for U.S. clients on a "standard" account under the "spread only" model is 1.3 pips while the "core pricing + commission" model shows a raw spread of 0.4 pips. OANDA advertises the use of an automated engine to attempt to follow global pricing closely, but spreads are still subject to market volatility and liquidity. In keeping with its ethos of transparency, OANDA publishes historical spread data for all of its asset classes. U.S. clients have the option to participate in OANDA's "advanced trader program" which is a 3-tiered reward system for high volume traders. Benefits include spread or commission discounts, being assigned a "dedicated relationship manager," API support, free VPS and wire transfers, and discounted access to third-party platforms. Tier 1 requires that the client deposit at least $20,000 or transact more than $10 million in monthly volume, whereas tiers 2 and 3 require monthly volume ranges of $100-$500 million and $500+ million, respectively. OANDA does not have a minimum deposit requirement for customers wishing to open a "standard" account, but logic dictates that this amount will be subject to the margin requirements of the smallest trade size that the customer wishes to place. "Premium" accounts require a minimum deposit of $20,000 which gets the client added perks like unlimited free wire transfers. OANDA's forex funding fees, charged on positions held overnight, are described as "a blend of underlying liquidity providers' tom-next rates, adjusted by our x% admin fee (annualized)." In addition to a monthly inactivity fee "of 10 units of the currency in which your account is denominated when there are no open trades in your account for a period of at least 12 months," the broker also lists fees for deposits/withdrawals, bank wire transfers, and debit card and ACH transactions. OANDA offers clients four ways to trade the markets with its flagship offering being fxTrade, which can be accessed via a download (desktop), browser, or mobile application. Plus, it also offers the popular MetaTrader 4 (MT4) download for the desktop, and mobile for trading on portable smart devices. fxTrade, OANDA's primary user interface, is well designed and provides clients access to trading instruments, complex order types, and account analytics. The desktop version offers proprietary charting as well as advanced charting from third-party provider Tradingview. Clients can take full advantage of OANDA's research offerings, including MarketPulse and Autochartist technical analysis directly from the platform, though the products will open up in a web page. OANDA's "order book" displays client sentiment while "depth of market (DOM)" provides insight into supply/demand dynamics. Additionally, an abundance of relevant tools and resources, including Dow Jones FX Select news and various types of calculators, make fxTrade an excellent trading platform. The web-based offering includes charts from Tradingview with advanced studies and display styles along with most of the functionality of the downloadable version. Clients also have the option of trading directly from charts. Other features include customizable watchlists, news feeds, research options (economic analysis, MarketPulse) that open up in a browser, and API access. OANDA offers a unique functionality whereby the client has the option to set trade defaults for individual instruments based on a specific amount of base currency, percentage of leveraged NAV, or amount in the account's currency. This gives the client more flexibility in their trading and aids in their overall risk management. OANDA also offers clients "a powerful and more dynamic trading experience" by partnering with third party providers MultiCharts, CQG FX, and TradingView. Furthermore, they offer VPS capability through third party providers BeeksFX, Liquidity Connect, and Commercial Network Services (CNS). fxTrade offers four basic order types with the option of attaching "take profit" and/or "stop loss" orders to them. There is also the option for a "trailing stop loss" order. Additionally, users can choose to set their stops and limits based on price or pips, and pertinent information such as "pip value," "trade value," and "margin required" are shown on the order ticket itself.
Clients can also use the popular MetaTrader 4 (MT4) platform for trading. MT4 includes advanced charting, studies, watchlists, and trade automation through "expert advisor" plugins that many traders appreciate. Because the MT4 platform is such a well-known industry standard, traders moving to OANDA from other brokers will be familiar with its functionality. On the downside, the look and feel of the application is a little dated and some functions can be clunky. The fxTrade mobile trading platform crams an impressive amount of functionality into a small platform to the point where it is almost as robust as the desktop application. Traders can access OANDA's trading instruments, complex order types, and account analytics all from their mobile device. The mobile platform also includes charts with price overlays, indicators, and flexible display styles as well as the ability to trade directly from the chart, just like the desktop application. Other features include news feeds and economic analysis. It was nice to be able to continue our research and trading experience on a mobile platform that felt very similar to our desktop experience. OANDA's client login page is impressive for its functionality. It empowers the client by providing various options that allow them to launch interfaces and manage account specifics, like adding or withdrawing funds, adding sub-accounts, changing passwords, accessing APIs, and contacting customer service. OANDA Account Management.OANDA's main focus is on forex which makes sense given that it advertises that it does "all things currency." The range of offerings include:
Though OANDA has the required amount of variety to effectively compete in the 2020 online broker landscape, it is lacking in some categories. For example, the broker does not offer individual stocks, ETFs, industry sectors, or cryptocurrencies, which limits its total CFD offering to 55, far below its competitors. To lend a bit more perspective, other leading forex brokers can offer anywhere from 1,000 to 10,000 CFDs to choose from. OANDA's customer support is available 24/7 via email. The broker advertises its business hours as being from Sunday 1PM EST - Friday 6PM EST but "live chat" and phone support are not available for the entire duration. Limited availability for chat and phone support aside, OANDA's representatives were courteous and knowledgeable when they were accessible. The support website also has a good knowledge base and searchable archive that should answer most questions about the trading platforms and order types. But this experience is likely to be inadequate for both very experienced and very inexperienced investors. A series of educational videos and articles is available for new and experienced investors alike. Live webinars are also available and cover a wide range of subjects, including market analysis, platform education, economic analysis, and Q&A sessions. Minor annoyances include the fact that the images and videos use inconsistent platforms, and some information is out of date compared to current trading platform releases. Not all of the education is in a single place, and navigation can be difficult. OANDA Education.New investors will need some patience as they try to navigate their way through the educational material. Material for beginners is good, though poorly organized. Clients seeking to create a plan and tracking progress will find it difficult to figure out what education was completed and what should be next. The OANDA classroom, which is a series of webinars, focuses mainly on live market analysis, but also includes a lot of basic platform navigation and analysis that should help fill the educational gaps. Much of the advanced content was geared towards using individual tools rather than investing skills. To summarize, the educational resources were adequate but weren't organized as well as they could have been. OANDA advertises that it offers a trading analysis application, powered by Chasing Returns, which analyzes the client's trading history. Basic real-time information about client activity, such as transaction activity and profit/loss breakdown, can be found on the platform. OANDA does not provide tax accounting tools on the platform. Trading is no longer a solitary task and more and more traders have come to rely on the opinions and insights of other traders. Social traders will find their experience lacking on the OANDA platform. Other than a forum, OANDA doesn't offer any social investing tools. OANDA ticks all the boxes here as they offer an impressive array of economic analysis, real-time news feeds, calendars, and advanced data analytics that are unusual to find in a retail trading platform. The "order book" provides insights into trader sentiment and behavior. MarketPulse, Autochartist, Dow Jones news, and calendars all serve to provide the trader with a comprehensive analytical tool set. For more experienced traders, the pattern matching engines and volatility analysis will be particularly helpful. OANDA's analysis tools allow traders to test their strategies using common coding languages and analyze the effect of economic news directly on charts. The target market for such features tend to be experienced traders who need advanced analytics and resources to deploy, test, and manage their trading strategies in real time. OANDA Research.It's no surprise, then, that OANDA was awarded multiple "highest customer satisfaction" awards by Investment Trends research. One possible drawback to such a wide array of tools and research is the education and training required to fully take advantage of them. OANDA does offer education and help for most of their tools and features, but it is fragmented and difficult to locate. In all, it's a very robust offering and an area where OANDA ranks above the industry standard, but if there is one criticism, it is that the material is scattered across OANDA's website and trading platforms. Traders should expect a learning curve as they try to find everything. OANDA Corporation is a registered Futures Commission Merchant (FCM) and Retail Foreign Exchange Dealer (RFED) with the CFTC and is a member of the NFA (#0325821). OANDA Europe is authorized and regulated by the FCA (#542574) in the U.K. and clients are entitled to additional asset protection up to £85,000 through the Financial Services Compensation Scheme (FSCS). Additionally, it is also regulated by the Investment Industry Regulatory Organization of Canada (IIROC), the Australian Securities and Investment Commission (ASIC), the Monetary Authority of Singapore, and the International Enterprise Singapore. Despite the impressive amount of regulatory oversight, the amount of protection for each account in the event of default is limited and may vary depending on where your account is held. For example, OANDA Europe Limited offers ESMA-mandated negative balance protection, while OANDA Asia Pacific Pte Ltd. offers guaranteed stop loss orders. U.S. clients are the exception, as OANDA Corporation does not offer their accounts any such protections. The Commodity Futures Trading Commission (CFTC) limits the maximum leverage available to retail forex traders in the United States to 50:1. More information can be found on OANDA's regulatory and financial compliance page. OANDA does just enough to meet regulatory standards as evidenced by the lack of two-factor authentication (2FA) and biometric authentication for its mobile application. Its unwillingness to offer client accounts protection above and beyond the bare minimum required by regulators is a bit perplexing given that OANDA has won several awards over the years for being at the forefront of catering to customers. One could argue that it's this stellar reputation that affords OANDA the luxury of not providing additional protection, but gambling on that may prove to be a bit shortsighted on the part of management. That said, OANDA's efforts to position itself as a trusted broker in the online broker space deserves credit. The company has emphasized its position by saying, "We believe the retail trading industry as a whole will benefit from a more transparent approach where brokers are held accountable for making questionable statements or falsely disclosing their interests." OANDA is well known to experienced traders in the forex market. Its proprietary platform, fxTrade, offers an excellent desktop trading experience which, when coupled with superior research and analysis features, is well suited to traders who already know what trading the retail foreign exchange market entails. The broker's stated goal is to differentiate itself with superior trade execution and transparency, and all data points to that being the case. While the research offerings are comprehensive, their organization leaves a bit to be desired as the material is scattered across OANDA's website and platforms. Moreover, despite OANDA's longevity in the online brokerage arena, the limited number of product offerings, especially when compared to its competitors, is a bit surprising. Being NFA/FCA regulated is a plus, but not providing slippage protection or additional deposit protections beyond what's mandated by regulators is concerning. That said, OANDA's pricing transparency, platform technology, and global regulatory oversight should give investors comfort. Seasoned traders looking for a well-designed desktop platform can find what they are looking for with OANDA.
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