Tips for choosing the right Forex broker

Tips for choosing the right Forex broker

Forex sales to start you must first open a Forex account through a broker. The global nature of markets, Forex offers a wide choice in the matter of the world.

Forex stock markets are different from common stock markets where brokerage commissions are based on equity and stock market and where the money is earned on the fees allocated to each trade, often referred to as the “broker”.

Dissemination

Forex brokers make their money from the difference between the quota price offered, the purchase price for the customers, and the bid price, the sale price of the customers. This is the distribution that is measured in “points” or “PIP” which is the smallest measure of price change on Forex. For example, a “point” or “PIP” changes the cost of dollar 0.0001X. It goes without saying that a wider distribution results in an increase in the income of the brokerage firm.
Reputation of Forex brokers and return of capital

To choose the right Forex broker, you need to consider an early reputation as well as the services it offers. Take the time to do your research, it will take time, but selling yourself will save you from unpleasant surprises and you will eventually make you money. There are a lot of information on the subject online and in newspapers. It is important to ensure the credibility of this information.The forum used by other traders Forex can help make you a better idea of ​​each company and complaints to each company. By relying on newspaper articles and statements of the forums and some people you can get an idea fixed in terms of good companies and can therefore list the best companies from which you can choose your own .

It is important to understand that there are many unscrupulous companies, as there are countries where regulation is relatively low. In countries such as USA, UK, Hong Kong and Australia, the regulations are quite strict.

United States, a Forex broker must have a minimum capital of $ 20 million at least, question the protection of client funds. To learn more about the laws of the brokerage firms in the U.S. A large high-capitalization company with a hundred employees, is in a position to protect your money even in times of crisis and provide services such as telephone support 24/24.

Stock accounts

It depends on your financial reserves and money you intend to invest for each sale, you will receive an account with the minimum capital requirement. This is the minimum amount that you must have in the account to start sales. Forex broker will recommend Honourable generally not invest more than 1-5% of your capital in any action. For example, an account with a minimum amount of sales of $ 1,000 dollars must have a minimum capital of $ 34,000.

Power

Many Forex traders increase their profit potential by increasing their power. There they borrow from their broker Forex to increase their sales volumes. This method, however, trade exposes the trader to higher potential losses. Brokers can offer their power from 100 to 1 or 250 to 1, where you can borrow up to 100 or 250 dollars for every dollar you deposit in the Forex broker.

Merchant Services

Some brokers include forex trading tools apply some of their accounts to which you will have access until they have subscribed. These include market data in real time, charting functions and access to the media industry financial reporting, commentary and analysis.
Prevention against scams

Unfortunately, there will always be a minority of unethical brokers who try to defraud their clients.

An office of exchange still does not sell in the general market as being in opposition. Instead, he takes the opposing party based on the fact that most Forex traders lose. They not only maintain the distribution, they are constantly losing their customers. Since the regulation of this market is mostly internal, they can disrupt the spread widening. In a country where regulation is weak, brokers can simply prevent the closing of sales, to ensure they will not lose.

Most of the trading platform to help “stop” when a currency reaches a predetermined price, then selling your business. It is a useful tool to minimize losses. However, unscrupulous brokers can view and edit your stop price and move the item, and sell out of bounds, made a quick profit and then award the prize in the previous position.

To avoid such traps, take the time to do your research, making sure that your broker is credible and obtaining an account and a trading platform tailored to your needs.