Length : 2.30 Minutes
Things to Consider When Choosing a Forex Broker?
The recent regulatory relaxation on brokerage businesses, has reduced entry barriers for online forex brokers. In the recent years, there have been a tremendous growth in the number of forex brokers, and choosing the right one requires cautiously sifting through an overwhelming number of sources that could be time-consuming and frustrating.
Due to this rapid growth, one must be cautious when it comes to choosing a right broker.
Therefore, We have provided you with a tailored list of regulated Forex brokers that we ourselves are trading or have traded with in the past to ease the path for you. It is extremely important to do business with a regulated broker, and we highly recommend you to do your research before choosing one.
Besides that, you have to also consider, which types of brokers suit your needs and trading style.
Therefore in this topic we are going to cover few important things that one has to consider before choosing a broker.
One of the main factor, to distinguish a reputable trustworthy brokers from fraudulent ones is the broker compliance with set of guidelines and regulations set by regulatory agencies all over the world. Below is the list of some of the regulatory agencies:
HONG KONG: Securities and Future Commissions (SFC)
SINGAPORE: The Monetary Authority of Singapore (MAS)
AUSTRALIA: Australian Securities and Investment Commission (ASIC)
SWITZERLAND: Swiss Federal Banking Commission (SFBC)
GERMANY: Bundesanstalt für Finanzdienstleistungsaufsicht (BaFIN)
FRANCE: Autorité des Marchés Financiers (AMF)
CANADA: Investment Information Regulatory Organization of Canada (IIROC)
CYPRUS: Cyprus Securities and Exchange Commission (CySEC)
Besides regulations, it is also important to check the account details and trading conditions offered by the broker, such as, offered leverage, fees like commission and spread, minimum initial deposit, deposit and withdrawal policies and options. It is also important to check what trading activities are allowed by the broker, as some of the brokers prohibit some trading activities like hedging and scalping. Trade execution quality and speed is also another important thing to look for when it comes to choosing a broker.
When choosing a broker it is important to make sure that the trading platform the broker offers is easy to use, well designed, has an adequate amount of technical indicators, fundamental analysis (News Feed), and most importantly trades can be entered and exited with ease. A lagging and poorly designed platform could cost you significantly, as it could increase the probability of errors due to its poor design when placing orders.
Besides that, the platform downtime could affect your trading performance since you will not be able to monitor your floating trades or placing a new ones. Most of the brokers offer Metatrader 4 and 5 as a platform, however there are some brokers that they have their own built platforms.
Generally speaking, Metatrader is the the most common platform used by the traders due to its user friendly nature.
In our more than 15 years experience of trading forex, we found it very hard to find a broker with a fast, efficient and quality customer service. Before opening an account we all experience a fairly good customer service, but once the account is opened and the fund has been deposited, we often experienced a sudden drop in the efficiency and quality of customer service provided. It is important to select a broker with a good and responsive customer service and support team to respond to your enquiries, complains and problems effectively and efficiently.
Since forex trading occurs 24 hours a day, the broker's customer support should be available at any time. When considering a broker, a quick call or a quick enquiry through Email or a live Chat can give you an idea of the type of customer service they provide.
Bottom line, it is important to examine, research and check all the mentioned factors above when searching for a broker. Also we strongly recommend you to look through the terms and conditions of any particular broker that you plan to engage even though it's boring and time consuming but trust us it is worth it.
We speak from our collective experience over the past 15 years with many brokers out there, that how the behaviour of some of them suddenly changed once we started generating profit. Some of them started sending us Emails once we made a lot of profit that our account has been terminated, red flagged and all sort of excuses to just make it hard for us to both continue and discontinue with them.
At the end, regardless of your trading result, a reputable and honest broker should provide you with the promised services hassle free and without interruption. Brokers really have no reason to make it hard for you to withdraw your profits because the only reason they hold your funds is to facilitate trading.
Thus, whether you are generating a great return or you are constantly blowing up your account, they must stay indifferent and offer you all the services as they promised. They should facilitate your withdrawal request hassle free without asking their sales team to constantly annoy you by calling and begging to stay. They should keep their platform running smoothly at all time and they should try their best to keep their spread within the range that they promised at the first place.