Choosing a forex broker is a crucial part of the trading process.
It is virtually one of the few first steps which are to be taken by a beginner trader right after deciding to trade and read at least something on the subject. Of course in case you are going to use trading signals you are going to be advised the best forex brokers available for your trading signals provider. But you can also choose your broker all by yourself. And that is where a question stands – how does one chose a good broker?
So, what constitutes a good broker? With so many possibilities it is quite hard to find a broker that is not going to suit your needs, that one is true. But there are certain points that have to be checked in your list in order to find a good one.
First one is regulation. Not a lot of forex brokers risk to work without being regulated. A lot of the countries actually ban those brokers who have no license and regulations. Regulations guarantee that the broker is going to be thorough with their job and with your money. Regulation guarantees the existence of the broker tomorrow, when you come to check on your account. And regulations guarantee that your assets are not going to magically disappear only to never be seen by you again.
But beware here – a professionally looking team and a beautiful website do not guarantee that your broker of choice is regulated. Always check. It is also better to have an actual regulation number in order to have the possibility to check the information.
The next step is looking for an actual information concerning trading process: leverage, margin, spreads, withdrawal time and initial deposit size. All of that is the information which are better known beforehand, rather than later. Make sure that you can find all of this information in the open and not after the registration and document submitting. And while initial deposit may seem like a not-so-important information spreads, commission and withdrawal are the things that you have to look out for on the early stages as these are the salt of your trade.
The more trading opportunities you have, the more successful you can be. That is why your next step in the search for forex broker is the amount of currency pairs that they have to offer. Of course every broker has the essentials – USD/JPY, USD/EUR EUR/CAD and GBP/JPY. But what if you want to trade peso against tenge? Rand against lari? Some versus Indonesian rupiah? Right! You have to make sure that your broker has as wide of the list as possible. Otherwise you are going to be stuck with the same players day by day.
Having a good support team is something that the broker has to worry about. But you are the one who is going to be using it. And you are the one who is going to suffer in case there is no 24/7 support teams. That is why pay extra attention to the way their support team works. Also, try and build good relationship with the members of the support team – the better they know you, the better your trading atmosphere is going to be.
Also never hesitate to spend more time on the search. Does this broker seem ok, but they lack something? Search further. You have to be fully comfortable with your broker.
These are the four most important first steps in your forex trading. However, if you feel the need to add some of the rules, do not hesitate to write in comments – how did you look for your broker?