Which broker is the best for forex trading? Want to jump straight to the answer? If you are ready to start investing in the forex market, we look at five things to consider when choosing the broker that is right for you:
No decision is as crucial for an aspiring forex trader as the choice of forex broker they make, as you simply cannot access the global forex marker as an individual, without using the services of a brokerage as an intermediary. Of course, it is possible to switch broker if you happen to make the wrong choice, but it is definitely wiser and more prudent to make the right choice from the beginning, as choosing the wrong broker, whether an unreliable one or one that does not best match and fit your own needs and requirements, will definitely jeopardize your chances for success and profit making.
To mitigate the danger of making the wrong choice of broker, make sure you fully grasp what is at stake and what it is you should factor in when taking your decision. To help this process, check out the very enlightening and insightful posts below, which touch upon every aspect, thus enabling you to effectively navigate the forex brokers landscape and make the best choice of broker for you.
Resorting to forex broker reviews, which are readily available online, is a method used by many existing or aspiring traders in order to compare and contrast the offering of different brokers. To make the best use of forex reviews however, you must know how to effectively read them and which information you should pay particular attention to. Find out if forex reviews are your best option or whether they may potentially hinder your quest for the best broker. Helping you sift through the rubble and put things in a better perspective, you can find out how to make the best of studying forex broker reviews and learn why and how you should always put your own particular needs as a trader above the opinion and evaluation of any review site.
Being a beginner and inexperienced in forex trading, renders you particularly vulnerable to making wrong choices, or taking unwise decisions based on lacking or wrong information. Remember that to get to the right answer, you must first be able to ask the right question and this is especially crucial when it comes to choosing your forex broker. The pursuit becomes a less complex process when you know the key virtues you should look out for in a forex broker, as well as the top issues to consider prior to opening your first forex trading account. Adopting a careful, step-by-step approach and being aware of smart tips to employ, can greatly aid your quest for the best broker and a successful trading start as a beginner broker.
Social Trading, i.e. being able to trade by copying, mirroring or mimicking the trading decisions and strategies of other traders, has indeed truly revolutionized the online retail forex trading world and has opened up trading to an even wider audience across the globe. As such, doing it the social trading way is a popular option for many aspiring traders. Find out what social trading is and which types of social trading are available and what the distinct advantages of social trading are for traders. If you decide that social trading is your vehicle for setting along the way of forex trading, learn how to successfully go about it and also come up to speed with the particular category of forex brokerages, which allow and facilitate trading through social trading, as they would be your brokers of choice.
You cannot find your ideal forex broker simply by performing an online search and signing up on the first company that comes up. To become a successful trader, you need to trade through a broker you can trust and such a broker must prove that it is worthy of this trust. Prior to searching and comparing features and offerings, you must have a very clear view of the situation and this present article primarily serves the purpose of refuting some popular myths which plague the online retail forex landscape and which may well obstruct and blur your view and overview. Learn what you should expect, seek and demand from your broker, while discovering that your best compass in the painstaking journey of finding the right forex broker is none other than you, since none else knows your own particular needs, requirements, skills or trading style, and most importantly your risk and loss tolerance levels.
Despite differing in what they offer, online forex brokerages are primarily ranked according to the brokerage model they adhere to. Across the available spectrum, traders may choose between ECN, STP and dealing desk brokers and this present post delves deeper into the world of true ECN forex brokerages outlining and explaining what they are and examining whether and how trading through such brokers may be beneficial towards the trading endeavors and success chances of traders. Through a detailed and true account of the advantages and disadvantages of trading through an ECN broker, you can find out if this particular type of brokerage is the most suitable for your own specific trading needs.
The trading platform is at core of the services offered by a forex brokerage, and an aspect which aspiring forex traders should pay particular attention to, since it is this platform they should be using when trading and it is through this platform that their trades placed will be executed. By far the most popular such platform, especially for small scale, novice traders, is the MT4 platform, which has been justifiably characterized as the closest to an industry standard. The platform used is another differentiating factor between forex brokerages and if you wish to trade via a particular platform then you should seek brokers who offer that particular one. Shedding light on all relevant issues and touching upon all aspects, through this handy guide you can make your MT4 brokerage selection with greater easer and confidence and enjoy the many benefits the MT4 platform offers traders across the world for so many years.
The online forex trading landscape is booming and expanding on a daily basis, meaning there is ample supply of brokerage services and agencies, to meet the increased demand across the globe. The sheer abundance of brokerages however is a double edge sword, since it guarantees that the right and most suitable broker for you definitely exists somewhere, but having to shift through the rubble to identify that best match becomes a complex and demanding task. Despite its complexity, it is a task worth pursuing as managing to identify the most suitable brokerage is bound to ease your journey into the world of trading and greatly maximize your chances for trading success in the long term.
Whether you want to choose best on which broker caters for social trading, which is mostly suited for beginners, which is the most reliable and trustworthy, which ranks best in reviews or according to the brokerage model they follow or trading platform they use, remember that the single most crucial factor to guide your selection, should always be your own unique personal circumstances, preferences and needs.
The forex brokerage landscape is so packed and crowded that any novice broker will surely get a headache just by browsing through the available brokerage options. Choosing the right broker is crucial in avoiding a potentially disastrous trading endeavour and in fact the actual brokerage choice is perhaps the biggest trade placed by a forex investor. This is because when opening an account through a specific brokerage your deposited funds are entrusted in them and your expectation is that you will be able to trade effectively using the services provided by the broker, and also be able to withdraw your funds when you have hopefully achieved profits.
Thus, it becomes evident, that if you choose the wrong broker, if you trust a firm that turns out to be scammers and fraudsters who will run away with your money, then you are in for a big disaster, no matter how much time and effort you have spent on learning about forex trading and devising your trading strategies. The secret to finding a great forex broker lies in striking a balance and following a set of tips that will ensure that the broker you choose is the most suitable for your own specific forex trading needs, while at the same time the choice you make is safe and does not leave you exposed to scams.
So, here’s what you should be doing during your broker choice process to avoid potential traps and loopholes:
To be able to assess whether a brokerage meets your needs and requirements, you first need to know yourself what these needs are. Before starting to research and compare brokers then, you must first know your own profile as a trader, based on your specific circumstances and your individual trading plans and goals. For example, if you are planning to be trading small amounts on a daily basis, aiming to capture small market moves, then you must only search for ECN brokerages. Though such a broker will charge you commission on each trade, they usually offer much tighter spreads and you will need access to those if you are trading small moves.
An ECN broker is also what you should be searching for if you are going to engage in scalp trading. Another important aspect to consider is the amount of capital you have available for trading. If you can only allocate a small amount to your trading endeavour, then you should seek brokers that allow you to trade in micro-lots through a mini-lot account and not open a standard lot account, which would work better with bigger available capital. Your actual trading needs are not the only ones to take into account. As different brokers accept different methods for funding your account and allow different ways for withdrawals to be made, you must know your own preferences and find brokers that can match them.
Knowing what you want is a great first step and would help narrow down the list of prospective brokers you are considering. Chances are however that the list will list remain quite extensive, so make sure you look out for specific merits in the remaining brokers, ensuring they do offer what really matters to you. For example, if excellent customer support is important to you, a good way is to open demo accounts with several brokers and then reach out to their customer support team with questions and queries. Check out their response time and whether the answers you are receiving are clear and helpful. This will help you eliminate all brokers who fare poorly in terms of customer support.
On the other hand, if dealing with a fully regulated broker is important for you, then you should be considering only those brokers fully regulated by reputable watchdogs across perhaps more than one jurisdiction, for example brokers regulate in the US, the UK, Canada and Australia or big EU countries. If you are less conservative and less risk averse, then perhaps you should also be considering more newly-established and yet unregulated brokers, as they often offer more highly lucrative opportunities. Moreover, if you plan to trade as a day trader then you will need a broker that allows you direct interaction with the market and not a dealing desk, as through a dealing desk trades longer to be executed and often result in re-quotes, which could lead to many trading opportunities being lost. Competitive spreads are also important for day traders and thus non-ECN accounts would not be suitable for this type of trading.
It is only natural as part of your broker research to check out what other customers and traders have written about a particular broker in terms of reviews or comments in various forums. The problem with such reviews and comments however, is that you have no way of knowing whether they are credible or not. In fact, many are often fake and this is true not only for positive reviews, that might be “planted” by brokerages themselves, but also for negative reviews as well. Ever since online retail forex trader made trading accessible to everyone, hordes of people are trying out and most of them end up losing money, but tend to blame others when this happens to them. If a trader is vocal about their losing trades and complaints about their broker, doesn’t necessarily mean that the broker was somehow at fault for the unsuccessful trades performed.
In a nutshell, though checking out what others have to say about each broker may be useful, you should always strive to maintain objectivity and consider all opinions with a pinch of salt.
And since we advise against relying heavily on the opinion of others, once you have narrowed down your list of potential brokers, it would be a very good idea and an effective assessment method, to test out those you are mostly interested in yourself. This can be done by opening demo accounts with all those brokers and compare their offering inter alia in terms of order execution, customer service and platform stability.
For those brokers that you find the demo account to be working consistently well for several weeks, you can proceed to open a live account but only fund it with a fraction of your available funds, just to ensure that things are equally smooth under real trading conditions as well. During this time, you may still be testing out the customer support responsiveness and effectiveness. Once you achieve some profits, it should also be prudent to withdraw some funds from your account to also have a valid opinion on how smoothly, easily and quickly withdrawals are handled.
If you are happy with a brokerage by this stage, then you can confidently deposit the full amount of your available funds and start trading full steam as following such a thorough due diligence, chances are that you have chosen wisely.
A final loophole to be avoided is being lured by brokerages that offer bonuses and other fancy schemes in order to lure in new customers. Though such offers may look very appealing on the surface, the truth is that nothing really comes for free and that there are usually terms attached to such incredible offers which end up interfering with your decisions and how you trade or how and how much you can withdraw. Moreover, when trading with bonus funds this may lead you to be reckless and take wrong decisions, while it is also true that the brokerages whose offering is already solid and excellent do not need to resort to such “offers” to be earning customers. Thus, since it is always better to be safe than sorry, ignore the sirens of bonuses, no matter how attractive they may look.
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