Before start working in forex trading the main step is the choosing a best online trading broker that is more appropriate for your trading style and safe for your capital. Read this complete detail of article, this will thoroughly guide you in choosing best forex broker and top rated broker.
What Is Forex Trading
We should know that ‘what is the forex broker’ before choosing the broker and what is forex trading. Forex broker may be a company, bank or financial institutions that allows forex traders and provide their platform for forex trading and allows to buy or sell currencies in inter market. Before starting forex trading with any forex broker you should know the following points about broker that you want to select.
1- Security And Regulation
This is most important part in choosing a best forex broker because you are going to invest your hard earned money. Broker that you are going to select for forex trading should be registered from highly regulatory authority. Some major regulatory authorities are FCA, CFTC, NFA, PRA, ASIC, SFBC, AMF, IIROC
2- Account Types
A good broker also offer multiple account type for trading in forex market. These accounts vary according to investment and initial deposits. ECN accounts are for those who want to trade in direct inter market through Electronic Communication Network and on other hand non dealing desk brokers are for retail forex traders.
3- Leverage and Margin
Forex broker offer different leverage for trade. Leverage is a kind of load that is given by forex broker to increase the margin for trading. For example you your broker offering 1:100 leverage and you have $1000 in your account, its mean you can trade of $100,000. More leverage can be dangerous for traders because with high leverage where you can make big profit, there is a big chance of big loss.
4- Spread and Commission
In choosing broker one step is to check their fee, commission and spread for the pairs in which you have to trades. Spread should be affordable. Some brokers do not charge commission and earn only from spread. Spread and commission is the earning of forex broker. Spread is the difference in both prices that are bid and ask, and it may vary according to market conditions and currency pairs. Brokers make their money from commission and spread.
5- Deposit and Withdraw
Process and fee for deposit and withdraw fund from forex broker is important step in selection of broker. For a good broker deposit and withdraw methods should be available and easy for everyone. Deposit and withdraw payment should be instant or in very fast processing. Fee should be very low or no fee is good for broker and mostly broker do not charge deposit fee. Many brokers have different account type that require different initial amount of deposit.
6- Trading Platforms
Trading platform, is the terminal that a trader uses for buying or selling a currency. You should check their trading platform before investment, it should be user friendly and updated. There are different trading platforms are available in the market like as Meta Trader 4 (mt4), Meta Trader 5 (mt5), c Trader, Web Terminal, Mobile Trading and Social Trading. A good trading platform should have a clear buy and sell both buttons and easy in use. Custom toll should be in trading platform for the use of traders.
7- Customer Support
Good customer services are the key features by any company for their client to contact and interact between company and clients. Broker that you are going to choose should offer 24/7 customer support. And broker should be problem solving for trader, they should solve the issues immediately if any of the trader have and make complain to its broker. Some brokers also have separate manager for traders to ensure better customer support.
Choosing a good reputed and best forex trading broker is not hard to find. Broker that you want to select should be register from high regulatory authority. Broker should offer good and different account types without or with very low fee and commissions. Trade execution should be instant and affordable spread is good thing. Customer services should available and responsive in solving issues for traders.