Top 6 Things to Consider While Selecting a Forex Broker
At present, the retail Forex market is extremely competitive, and therefore,
you will get a major headache if you simply think of sifting through all the available brokers.
It can be quite confusing to select which particular Forex broker to trade with particularly
if you don’t have any idea of what you ought to be searching for.
In this section, we are going to talk about the qualities that you ought to look for
while selecting a Forex broker.
A high level of security happens to be the first characteristic that should be possessed
by a competent broker out there. In the end, you will not be handing over a lot of
cash to an individual who just claims that he is legitimate.
Luckily, it is not difficult to verify the credibility of a Forex broker at present.
You will find regulating companies around the globe that separate the reliable from the deceptive.
Below, we have provided a list of nations along with their corresponding regulatory bodies:
United Kingdom: Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA).
United States: Commodity Futures Trading Commission (CFTC) and National Futures Association (NFA).
Switzerland: Swiss Federal Banking Commission (SFBC)
Australia: Australian Securities and Investment Commission (ASIC)
Canada: Investment Information Regulatory Organization of Canada (IIROC)
France: Autorité des Marchés Financiers (AMF)
Germany: Bundesanstalt für Finanzdienstleistungsaufsicht (BaFIN)
Even prior to thinking of putting your hard-earned cash in a broker, ensure that the broker happens
to be a member of the above-mentioned regulatory bodies.
You will always be required to pay transaction costs irrespective of the type of currency trader you
happen to be.
Each time you get into a trade, it will be mandatory for you to pay for either a commission or the spread,
and therefore, it is only natural to search for the most inexpensive and the most affordable rates out there.
At times, you might be needed to sacrifice a low transaction for a more dependable broker.
Review all of your available options after making certain that you know whether you require tight spreads
for your sort of trading.
It is all about figuring out the proper balance between low transaction prices and security.
Withdrawal and deposit
You will be allowed by the good Forex brokers to deposit funds plus withdraw your earnings without any
Brokers actually do not have any reason to make it difficult for you to withdraw the profits since facilitating
trading happens to be the only reason they tend to hold your funds.
Your money is held by your broker for making trading easier such that there isn’t any reason for you to
have any difficult time obtaining the profits which have been generated by you. It is imperative for your
broker to make certain that the withdrawal procedure is smooth as well as fast.
The majority of the trading activity takes place in online FX trading by means of the trading platform of the brokers.
This implies that your broker’s trading platform ought to be stable as well as user-friendly.
While searching for a broker, always verify what exactly it’s trading platform has got to offer.
Verify whether it offers news feed for free. What about simple-to-use charting and technical tools?
Does it provide you with all the info that will be required by you to trade effectively?
It is imperative for your broker to fill you have the best feasible cost for your orders.
Under standard market conditions (for example, normal liquidity, no surprising events
or vital news releases), there is no reason for the broker not to fill you at,
or quite close to, the market cost that you see while clicking the “sell” or “buy” button.
For instance, presuming that you own a reliable Internet connection, you ought to get
filled at the cost or within micro-pips of that cost in case “buy” EUR/USD for 1.3000 is clicked
by you. How fast your orders become filled is quite vital,
particularly if you happen to be a scalper.
Several pips difference in cost will make it quite difficult on your part to win that
Service brokers are not perfect by any means, and because of that,
it is important for you to select a broker whom you can contact easily in case of any problem.
The proficiency of brokers while handling technical or account support issues are equally
crucial as their efficiency in performing trades.
Even though brokers might be helpful and kind throughout the account opening
procedure they usually have awful “after-sales” assistance.
Written By : YOUSSEF J A ALMEER
Image rights @ fxdailyreport.com