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6 Most Important Things to Consider When Choosing a Broker
The retail forex market is so competitive that just thinking about having to sift through all the available brokers can give you a major headache.
Choosing which broker to trade with can be a very overwhelming task especially if you don't know what you should be looking for.
In this section, we will discuss the qualities you should look for when picking a broker.
1. Security
The first and foremost characteristic that a good broker must have is a high level of security. After all, you're not going to hand over thousands of dollars to a person who simply claims he's legit, right?
Fortunately, checking the credibility of a broker isn't very hard. There are regulatory agencies all over the world that separate the trustworthy from the fraudulent.
Below is a list of countries with their corresponding regulatory bodies: * United States: National Futures Association (NFA) and Commodity Futures Trading Commission (CFTC) * United Kingdom: Financial Services Authority (FSA) * Australia: Australian Securities and Investment Commission (ASIC) * Switzerland: Swiss Federal Banking Commission (SFBC) * Germany: Bundesanstalt für Finanzdienstleistungsaufsicht (BaFIN) * France: Autorité des Marchés Financiers (AMF)
Before even THINKING of putting your money in a broker, make sure that the broker is a member of the regulatory bodies mentioned above.
2. Transaction Cost
No matter what kind of trader you are, like it or not, you will always be subject to transaction costs.
Every single time you enter a trade, you will have to pay for either the spread or a commission so it is only natural to look for the most affordable and cheapest rates. Sometimes you may need to sacrifice low transaction for a more reliable broker.
Make sure you know if you need tight spreads for your type of trading, and then review your available options. It's all about finding the correct balance between security and low
The retail forex market is so competitive that just thinking about having to sift through all the available brokers can give you a major headache.
Choosing which broker to trade with can be a very overwhelming task especially if you don't know what you should be looking for.
In this section, we will discuss the qualities you should look for when picking a broker.
1. Security
The first and foremost characteristic that a good broker must have is a high level of security. After all, you're not going to hand over thousands of dollars to a person who simply claims he's legit, right?
Fortunately, checking the credibility of a broker isn't very hard. There are regulatory agencies all over the world that separate the trustworthy from the fraudulent.
Below is a list of countries with their corresponding regulatory bodies: * United States: National Futures Association (NFA) and Commodity Futures Trading Commission (CFTC) * United Kingdom: Financial Services Authority (FSA) * Australia: Australian Securities and Investment Commission (ASIC) * Switzerland: Swiss Federal Banking Commission (SFBC) * Germany: Bundesanstalt für Finanzdienstleistungsaufsicht (BaFIN) * France: Autorité des Marchés Financiers (AMF)
Before even THINKING of putting your money in a broker, make sure that the broker is a member of the regulatory bodies mentioned above.
2. Transaction Cost
No matter what kind of trader you are, like it or not, you will always be subject to transaction costs.
Every single time you enter a trade, you will have to pay for either the spread or a commission so it is only natural to look for the most affordable and cheapest rates. Sometimes you may need to sacrifice low transaction for a more reliable broker.
Make sure you know if you need tight spreads for your type of trading, and then review your available options. It's all about finding the correct balance between security and low