Advantages and Disadvantages of Market Data

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Market data can be acquired when a trader live streams trade-related data. It is made up of information like market volume, price, and bid/asks the price. Market data can be accessed in many global markets such as indices, stocks, commodities, and forex. Using the market, traders can assess various asset’s worth and possible approaches when entering and exiting each trade. One of the major aims with the use of market data is to acquire as much information as possible over specific information on the asset from reliable data sources such as the data software of IRESS that you want to trade so you can properly calculate the market risk as well as its impact on each news release.

The Advantages and Disadvantages of Market Data

For traders using market data, you surely research so much about the advantages of market data that you forget its cons or the disadvantages that it possesses to your trades. Knowing the pros and cons of this financial tool allows you to maximize its benefits while limiting the risks associated with it.

Advantages of Market Data

Since market data is a set of information generated in real-time, this can be used as a source of accurate trading decisions. However, remember that the market changes every minute, and the minute old information you have can be inaccurate the next minute, leading to bad decisions in trading.

Moreover, it is also possible to use market data in accessing historical prices. Historical charts are important when it comes to dealing with technical analysis. It can also be used to make a strategy that you can utilize for future trades.

You will mostly see market data in one place with a ticker symbol. This allows easy access for beginners who are using the trading platform. As for market pricing data, it is usually kept separate away from other financial information. Some data providers also choose to deliver fundamentals.

Disadvantages of Market Data

It is essential to get real-time news updates because the market can change swiftly. Traders also need to make quick decisions to get along with the fast pace. Therefore, market data must be up-to-date and real-time always. But in some cases, there are risks in lags and latency when it comes to delivering information, especially since the information is from the different trading venues across the globe. One thing that you need to ensure upon starting with Forex trading is the data provider. Software companies like IRESS provide fast and reliable data providers that regularly update the latest news and information in the market. Besides the internet, you may also check the traditional financial news source and information such as newspapers or the financial news update on your favorite TV station.

Always aim to get news from reliable sources as there are also news sources that aren’t accurate. Go for big names in the industry. They are trusted for years in delivering real and accurate news, especially in the financial world.

Advantages and Disadvantages of Market Data

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