It is not so straightforward to find a forex trading broker that
can meet all your needs. There is no perfect dealer. Maybe as long as
your broker can meet your criteria, they are considered "perfect" to
you. With more than 100 trading platforms online, going through each
broker one by one can be confusing if you do not know what to look out
for in a reliable, professional and reasonable forex trading broker. If
you are reading this, you just found yourself some golden tips here.
By
now, perhaps you are fully aware that the foreign exchange market is
not regulated by any central body. Since this is so, it can be subject
to fraudulent or less than ethical and professional practices by some
dealers. Read the tips below and make sure you apply them and you can
prevent falling into scams and end up with a professional forex trading
broker you can work with for a long time to come.
1. Do not be embarrassed to ask the prospect for references.
2.
While the currency market is not controlled by a central body, each
country may have its own regulatory body or watchdog organization to
exercise certain control over the business activities of these forex
trading brokers. If the dealer is based in the US, do a check at
Commodity Futures Trading Commission (CFTC) and National Futures
Association (NFA) to see if the dealer is registered with these two
organizations. Find out if there is any bad report or complaints against
your prospect.
3. Make a comparison of the account specifics of
each prospect. You should compare the minimum opening deposit, spreads,
leverage, commission charges and more. Always be sure to ask the
prospect if there are any other charges other than what was shown on
their websites. They are obliged to inform you. This step is helpful as
not all brokers who say they offer the lowest rates on their websites
are truly honest about it.
4. An easy to navigate trading platform
is important especially if this is the first time you are trading
currency. This is why it seems puzzling why some trading platforms that
are created are so difficult to use. If the prospect offers a demo
account, sign up with them.
5. Requoting can really cost you big
time. While some brokers entice you with the "lowest bid/ask spreads and
commissions", they may practise requoting. This means that when you
carry out a buy/sell order for a currency pair, the price you see is not
what you get. In short, you are charged at higher prices if you buy,
and at lower prices if you sell. Either way, the odds are against you.
Do
not undermine this requoting matter. Some currency dealers may requote
on a difference of more than 8 pips. That is a lot if you are trading on
small price ranges. There have been complaints from traders about many
which requote whenever they are profiting. Avoid these and try finding
one that does not do so or at least not so often.
With these
golden tips, you are now equipped to search for a professional broker to
open an account with. Currency trading is not for the faint hearted.
They can be risky but with controls and certain good investing habits,
the profit potential is huge. Discover from my website which forex trading broker has scored well for each of the aspect we spoke about earlier and pick up more useful tips on foreign exchange trading today.
Learn everything about forex trading from Davion's wildly popular Forex Trading Made Easy blog - from mastering the basics of foreign exchange trading to discovery of new trading tips, strategies, tools and more.
