How do you recognize the right Forex broker?
Are you considering the possibility of multiplying your funds by trading on Forex? No doubt you will need a reliable broker, the problem lies in the fact that in the face of a market that is on the rise and gaining in popularity, hundreds of new brokers have appeared, complicating your task of finding the right one in the face of so many offers.
How to recognize the ideal broker? What aspects to take care of before making the decision? Which are the brokers that lead the current market? This and many other questions will be revealed later, so the invitation is to stay until the end and also know those tips or suggestions to decide for the right one.
What is the function of a Forex broker?
Also called Broker, a Forex broker is nothing more than a financial institution or brokerage firm in charge of coordinating the operations of buying and selling in this currency market; this implies that it is the one in which you open an account and deposit the funds to start investing, since it acts as an intermediary in exchange for a commission.
How much does this commission amount to? It depends, as there is no fixed task, it is delimited according to the difference between the purchase and sale prices, or what is equal, to the amounts that come into play in each transaction.
How do you choose the best Forex broker?
This is undoubtedly the million dollar question, unfortunately, there is no exact formula, making it imperative to analyze various characteristics before making a decision; however, as the goal is to give a little light on the matter, some tips and tricks are brought to consider if you want to maximize the chances of being right.
Trust is everything!
Do you want the best forex broker? Write down your options for those who work with a reputable company, remember that it’s money you’re going to invest, which you probably had a hard time raising.
Even though the task is tedious, you will need to do a lot of research, as well as get opinions from other traders, limiting your list to those who boast not only experience, but excellent reputation; likewise, pay attention to your client portfolio, only the good ones handle thousands of accounts.
Regulation and Security:
In order for a Forex broker to be considered reliable, it must comply with every regulation and be secure; in particular in Spain, the invitation is to check the proposals of those brokers regulated by the Cyprus Securities and Exchange Commission (CySEC), or in its absence the International Finance Commission (IFC).
Beware of unregulated brokers, they lurk around waiting for the opportunity to find naive traders who fall for the temptation of their attractive security deposit, hence be wary of those who are extremely low.
The best Forex broker? the one that fits your needs
Your decision should be based on what is important to you, although the experience and knowledge of others will be valuable, include in the determining factors your own criteria. What does this mean?
Decide, then decide…
Even though the service is the same, there are many discrepancies between the different brokers, especially with regard to commissions, margins and the trading platform. Take time to define the most important criteria, then complete them with what each one offers you and compare, then you will know which one meets the most criteria.
Offers and terms of trade
Do you want a viable criteria to evaluate the level of reliability of a Forex broker? Check the return of the investment you propose as well as the trading rates, the first one has to be high, while the second ones have to be as low as possible. This is where the demo accounts that, for free, propose some platforms, become allies.
Enter the portals of those brokers who arouse your interest, and know their trading conditions in this demonstration account, will serve as a guide before investing real money, because you will discover what are the possible benefits.
Beware of misleading offers!
As in any other aspect of life, if it seems too good to be true, it is because it may not be! Beware of falling into lucrative bonds, most of them are just marketing tricks of unscrupulous companies that only think about their own interests.
You only have to look into the terms and conditions that accompany them to realize that what is hidden behind them, turns out to be a clear and great scam.
The questions that cover the basics:
When choosing a forex broker, it is important to answer certain key questions, as the level of trust you can offer depends largely on your answer:
1. How many years have you been in business?
This will allow you to know the degree of experience with which it has.
2. How have you survived the bear markets and large customer losses?
This will give you an insight into how they handle contradictory scenarios and their responsiveness.
3. What is your reputation for client support?
The best brokers offer a variety of customer support services in different languages, ranging from phone support to email and chats.
4. What is your trading platform like?
At the end of the day it is the most important trading tool, those offering demo accounts that allow you to evaluate their flexibility and ease of use, will always be as recommendable, as those that are fed by various functions and good level of customization.
5. What payment methods do you offer?
It has to be simple not only the deposits, but also the withdrawals, so the diversity of alternatives will be elementary; both processes have to be fast and with encrypted data, because personal information will have to be provided for identification.
Choosing the right Forex broker requires that you take the time to compare the different proposals, evaluating key criteria such as margins, rates, platform, software and any other points that are of interest to you; likewise, make sure that you are a regulated broker and that you have a good reputation before you start investing.