Tips on choosing a forex broker

Tips on choosing a forex broker

A currency trading broker,also known as a retail forex broker,or forex broker,handles a certain portion of the volume of the overall foreign exchange market.Tho who wish to trade in currency often use these brokers to access the 24 hour currency market.

While the market is awash with many of these brokers,it is prudent to be sure before deciding on which broker to use.Below are some essential tips which will assist you in this regard.

1.It is important to do thorough research before making any decisions.Ask whether the would be broker is registered with any regulating authorities. Does the broker offer fixed or non-fixed spreads,how wide are the spreads?How much or how little leverage will a broker give you?Does this broker credit or debit daily rollover interest?Some brokers either do both,deduct interest,or neither.

2.The next step should definitely be about comparing brokers. A helpful resource guide such as the broker comparison guide can go a long way in assisting you make informed decisions.

3. Opening demo accounts and asking questions is highly recommended. Pick at least two brokers that fits most of your criteria and open up demo accounts. Most demo trading platforms are very similar to their live counterparts,but not exactly the same.There may be a difference in speed of execution,slippage and platform reliability. When you do have your strategy down and you are ready to move to a live account,start off small,test the waters and see if this particular broker will suit your trading needs.

4.Dealing tools and value added services are of utmost importance in this process.A good broking firm must offer you the best resources and information to help you make the smartest trading decisions. A good company should offer real time charts,technical analysis tools,real time news and data as well as software or website support.Be wary of any company that refuses to share information or trial versions before opening up an account.

5.You can never engage in this business without considering the aspect of customer support.One of the most important things you should check in a broker is the support service.Forex is a 24 hour market,so ideally,the broker you choose should offer support at anytime.You also need to ask other important questions such as which medium is used to contact the help desk and can you speak by phone to a live person and is the support offered in your language? Do the representatives seem knowledgeable?

6.Lastly,consider getting referrals.Ask around and read forex forums to find out which forex brokers other people use and why they selected a specific broker.

Categories: Financial tips