The main reason why you are getting into the foreign exchange market is to gain profits. This is the main reason why forex brokers are also in the market. You and your forex broker should co-exist and both reap profits out of your trading activities. This is the reason why you have to find a reputable and reliable forex broker that you can trust to watch out for your profitability as he does for his own. Choosing the right forex broker is your first step to reaping profits in the forex market. There are plenty of forex brokers for you to choose from, each one offering their own set of service packages and performance quotes.
The sheer number of forex brokers around can confuse you and you could end up with a scrupulous broker who is simply out to run away with your trading capital. For the best chances of staying in the forex market, you should take note of the following considerations in your search for a forex broker:
Reputation. Legitimate forex brokers are accredited and regulated by local and international finance regulatory bodies. Among the regulatory agencies with which reputable forex brokerages are registered include the National Futures Association (NFA) as well as the Commodity Futures Trading Commission (CFTC) in the United States and the Financial Services Authority (FSA) in the United Kingdom. Do your research online to find out whether a particular forex broker is sound and stable.
Capitalization. You want to deal with a forex broker that is well capitalized. Well-capitalized companies are less likely to get into insolvency. Any forex broker in the United States is not required to separate their clients’ funds from their own operating funds. Despite this, there are still those that do maintain separate these two funds, protecting their clients’ funds in case they are declared to be insolvent.
Affordability. The allure of forex trading comes from its accessibility and affordability to ordinary people without millions in disposable income to invest. Look for a forex broker who can offer you the best leverage and margin levels. Check your options for adjustable leverage levels to allow you to better manage your risks. If you have limited trading capital, you can also look for a forex broker that allows you to trade smaller lots.
Responsiveness. No matter what type of forex trader you are, you want your forex broker to be responsive to your trading orders. You do not want to have delays on the execution of your trading orders lest you lose out on the profits that you expect. Some of the problems that forex traders have with their forex brokers concern these delays that cause slippage in the currency quotes and substantial losses for the traders.
Support. Any broker that you choose should be accessible to you 24/7. There should be an open communication line with your broker no matter what time you need information about your trading account or anytime you need to execute a trade. Most forex brokers today have an online customer service support facility as well as other trading advice facilities that you can rely on when you need forex trading assistance.
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