When you decide to test the forex waters, it will not be an easy dive as the market is vast with multiple brokers who know what they are doing. Your choice could land you in the hands of a scammer or a trusted broker. Therefore, you need to be keen before making hasty decisions. Find out the most important things you should consider when choosing a forex broker.
1) Read Reviews
Any good work can never go unnoticed, and that is how most trusted companies earn their reputation. Some websites offer quality information on top forex brokers who would be of help to you. Being rated among the best means that the brokers are good at what they do, and there is no worry about entrusting your money with them.
The reliable websites provide you with vital information since they research and analyze various brokers thoroughly before compiling the data. They focus on reputation, financial instruments, regulating authorities, trading platforms, and features the brokers use. You will also find helpful information that will help you, especially if you are a beginner in the forex market.
2) Trading Platform
In most of your trading activities, you will be using your broker’s trading platform. Therefore, it has to be stable and user-friendly, which you should consider before hiring the broker. You will have to find out if the platform will function on a phone or desktop, charting tools, and offers a live news feed.
When you know your trading plans, it will be easier to choose a suitable trading platform for you. However, you can always configure a trading platform into one that meets your preferences.
3) Regulating Body
Your security is essential, and that is why each country has its regulating bodies to help keep you safe. For instance, the United States has NFA (National Futures Association), Australia has ASIC (Australian Securities and Investment Commission), and the United Kingdom has FCA (Financial Conduct Authority). To avoid being a scam victim, you have to ensure that the broker you choose is credible.
You are investing your hard-earned money, and as such, you need a legit person to handle it. Regulatory agencies help keep the forex market in check. You can find if your broker is a regulated one by comparing the registration number on their homepage with that on the regulatory agency’s website.
4) Customer Service
How the customer support assistant behaves towards you is essential to consider. Sometimes things could go wrong, and you want immediate assistance, but if no one is ready to render help, you may lose your money. Therefore, how the customer care representative approaches you, handles your questions, and the time it takes to get back to you is of utmost importance.
5) Deposits And Withdrawals
How you deposit and withdraw your funds should be easy and not an uphill climb. You should be aware of the methods of depositing and withdrawing that your broker prefers. Some of the ways could have a specific time to transact or have high withdrawing fees, which is not favorable for you.
You need a reliable broker that will ensure you have an easy time accessing your profits. The broker’s primary role is to facilitate the trading process and not have a say on your funds. Therefore, the withdrawal process should be easy flowing for you.
6) Cost Of Transaction
There are transaction costs that each forex trader has to incur each time he or she trades. Therefore, since the costs are inevitable, what you should look for is cheap and affordable rates. Some brokers may offer a low price to attract investors.
However, it would help if you were on the lookout for fraudsters as they may be using the low rates to lure you into their net and then escape with your money. Therefore, instead of going for the cheapest rates, you should opt first for a reliable broker. Your type of trading will also guide you on the spreads or commission you will part with.
7) Test Brokers
You will find many brokers out there, and it would not make sense to test all of them out. You have to cut most of them from the list by checking various factors, and those that lack should be out of the list. In the end, you will have a few left, but it may be hard to know who is the most suitable.
You can test the few brokers that piqued your interest by opening a demo account and observing it before opening a live account. When you open a live account, use a small amount of money to deposit.
During withdrawal, take note of the process to see if it is easy or cumbersome. You can also check how the customer service operates during the testing period. Once you know what kind of broker you are dealing with, you can deposit the remaining cash and trade without worries.
Carson Derrow 2021-03-03 06:18:18