When it comes to online trading, and in particular forex, choosing the right broker is of utter importance.
Your broker will be your medium to invest in the forex market, giving you access to a platform, market information, currency pairs, and getting commissions from your transactions.
And there is a wide variety in terms of what each broker offers and what financial products they offer. So, how do you choose the best forex broker for you?
We are going to walk you through different aspects to consider when making this decision. However, a good start is checking out reviews and opinions from other users, and for example, looking for the top 100 regulated brokers with high leverage.
Before even starting to think about what commissions the broker asks for, or how their platform look, if they deal in the currency you’re interested in, the most important thing to consider is if they are regulated. Do not choose a broker with shady regulations, or simply without, because you as trade and your money, will be at risk.
A broker that is regulated is a broker that plays by the rules, therefore can offer certain transparency.
What to look for when choosing a Forex Broker?
As we have mentioned, there are different aspects to take into consideration when sitting down to decide what broker you are going to entrust your money to and which one has the best potential to help you increase your wealth.
While some aspects are always important, like the fact that brokers must be regulated, other sections may be more or less important to a particular trader. It’s fundamental to know your trading style, have clear goals and objectives, and know what you expect from your broker.
Doing a bit of inner thinking will not only narrow the options when choosing a broker, but it will help choose one that satisfies your financial needs as a trader and will be up to your standards.
Making sure the broker of your choice is regulated by the national authorities should always be the first step. Each country has its regulations and authorities in place in charge of overseeing the financial activity in the forex market and acting as intermediaries in case of foul play.
Regulatory bodies help ensure transparency in the market, making sure traders’ rights and their money are protected.
Another important aspect to consider is the spreads, which are the difference between the buying price of a currency and its bidding price.
Spreads are important when making deals in the forex market, because they are similar to a commission to the broker, and have an impact on how much profit can you make out of a particular deal.
In fact, many brokers advertise 0 commissions and fees, giving a false impression they are more advantageous when spreads are always in place with every single currency pair.
Each broker may decide what currency pairs they offer to their traders. The big currencies, like dollars, euros, pounds, etc, are usually easy to have access to. However, there are less common pairs that not all brokers offer.
If, as a trader, you are interested in a particular pair, you may want to make sure the broker you are checking out offers it.
Platform and Customer Service
A final aspect that we recommend traders consider when choosing a broker is the platform and customer service they offer.
When it comes to the platform, the ideal situation is for traders to be able to use a demo account to get familiar with the ins and outs of their particular program.
And for customer service, make sure they have different options, like phone and email, to be able to call when you need them.