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Market Maker Trading Platform

CMC Markets Review
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CMC offers CFDs on thousands of different instruments including UK and international shares, indices, treasuries and commodities. Clients can trade all these diverse markets online using the company’s award-winning Marketmaker software. This advanced real-time trading system comes complete with live dealing prices, breaking news, professional charting and market analysis.

Marketmaker is the name of the trading interface that you get from CMC Markets. Actually, Marketmaker is a set of software applications, either be downloaded on to the desktop, or accessed via a web browser or handheld. This review mainly addresses the downloadable desktop version, which is the one in widespread use.

CMC Markets have been going since 1989, and are based in the UK. In Australia they are regulated by ASIC. The CMC Markets Group offers a range of investment products and investment tools including shares, options, listed managed investments, warrants, interest rate securities and CFDs. They have expanded worldwide in recent years and have offices in London, Frankfurt, Dublin, Madrid, Vienna, Sydney, Tokyo, Toronto, Beijing, Auckland, and Singapore. In 2007 CMC Markets launched its broking arm with the acquisition of Andrew West Stockbroking and CMC Markets Stockbroking is now one of the only non-bank aligned, online stockbrokers in Australia. In October 2009 CMC started providing Contracts for Differences in the Canadian market, which made them the first provider to enter the Canadian market.

The Marketmaker platform is multifunctional and has some great features like being able to back test on 10 years worth of historical price data. You can trade thousands of products including shares, indices, commodities, and Forex. The layout of the platform is fully customisable so you can arrange the screen layouts however you want. In addition you get real-time news, tables of your open positions, and charts all available on one screen.

Marketmaker has a simple interface that allows you to quickly enter a market order or to setup more complex instructions like an ‘If Done’ or ‘One Cancels the Other’. While I was testing the platform, I found the interface very user friendly and the charts easy to use, and overall does the job well, but it is not as comprehensive as a standalone software package. There are 42 different indicators, although you can create your own. There is a facility for one click trades, which most providers are including nowadays. It can be dangerous if you don’t have good mouse control, for example when running it from a laptop on the road, but is very useful when wanting to make a quick deal. The charts are developed in-house and Level 2 is available free of charge on the CFD account.

Those who rely on technical analysis as a central component of their trading will appreciate the integrated real-time charting capability. This provides a quality level charting package that runs off both historical and real-time data. The analysis can be presented in a variety of different formats such as line, bar and candlestick and comes complete with a comprehensive set of customizable indicators, while the more adventurous can also program their own. You also have a back-testing function. For example, a client who wanted to evaluate whether a strategy of buying the FTSE when the RSI fell below 30 and selling when it rose above 70 could test this out on historic data, with the software generating the list of trades and their profitability.

CMC claims that they do not charge commission but this is untrue as CMC is a market maker who generates its income from the underlying bid-offer spread. CFD prices are derived from the share markets with dealing spreads that will closely follow the true cash price. There have also been some issues in the past because CMC Markets operates as a market maker. Many brokers work in this fashion, and there is always a suspicion that the spreads and figures can be manipulated against the trader, as in essence the trader and the company can have conflicting interests. The conflicts can be mitigated by the company offsetting the trades on the market but it is up to company policy whether this action is taken. However, a losing trader is likely to look for someone to blame. If you’re concerned about price manipulation, then you may wish to look for direct market access trading.

It is worth noting that CMC Markets now offers variable margin, which allows traders to use as much (or as little leverage on trades as they choose. The platform now also supports fractional ownership which in practice means that clients can place trades on as little as one-thousdandth of a share – which is particularly useful to mirror exact hedging CFD positions against a physical ownership.

On the negative side, the Market Maker platform can be a bit slow and occasional platform freezes have been reported. There is no way of knowing if this was a particular conflict on the user’s computer, but of course you might have the same problem on your computer. It is suggested that you should at least run the demo platform for sometime before thinking about opening a real-money account. It’s also useful to have a telephone number to contact your broker handy anyway, in case your computer breaks or your Internet goes down.

Some of these problems may no longer be an issue now, as there have been a recent trading platform update. My best advice is to try out a demo version before committing any money to the account, and form your own judgment on whether the platform will run reliably on your desktop machine.

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