When you feel that you are ready to start trading in currency or other assets, you need to find a reliable broker. First of all, you should pay attention to exactly what these services are. A trading broker is a firm or company that provides traders with access to a trading platform that allows them to buy and sell foreign currency and other assets. Traders use their services to gain access to the 24-hour market. Thus, a currency trading broker, often called a retail forex broker, processes some of the total volume of the foreign exchange market. Mostly they work with bid-ask spread.
Which broker to choose for successful trading? Your first priority is to do research to find out if the company has an exceptional reputation and can meet your needs. The vast majority of major brokers will allow potential customers to test their services in practice on a demo account so that they can get a good idea of what the system really is. It would be wise to check how many platforms you can try before using the company's service.
Ways to Make a Good Choice
Which Forex broker to choose to start trading? As you know, the foreign exchange market has a daily volume of trillions of dollars, which makes it the largest in the world. Since it is not centralized, traders must choose a company that can help them conduct their trading activities. There are a large number of brokers, and choosing the right one takes time and research.
How important is regulatory compliance?
The first thing you need to check when searching, if you don’t know which broker to choose, is regulatory compliance. For example, an American legal company will be a member of the National Futures Association (or NFA), officially registered with the US Commodity Futures Trading Commission (CFTC).
If you are looking for a broker on the Internet, a professional website does not guarantee that the company is a member of the NFA or is subject to CFTC regulation, and the same applies to the relevant institutions in your country of residence. If it is registered properly, all detailed information about this will be reflected on the website in the "About Us" section, as well as on each web page. As mentioned earlier, each country has its own regulatory authority. Due to potential concerns about the security of deposits made, all accounts should be opened only in companies whose activities are properly regulated.
List of Important Account Information
Speaking about which broker to choose for a beginner, it is worth noting that each of them offers different conditions on the account, which include many parameters.
First of all, these are leverage and margin. Participants have access to a range of leverage amounts depending on the broker, for example, 50: 1 or 200: 1. Leverage or leverage is a loan provided to margin account holders by their brokers. For example, applying a leverage of 50: 1, a trader with an account size of $ 1,000 can take a position that is valued at $ 50,000. Leverage works in favor of a trader with winning positions, as the potential for profit is greatly enhanced. However, it is able to quickly destroy the trader’s account, as the potential for losses increases. It follows from this that leverage should only be used with caution.
The second important offer for traders is spreads and commissions. The broker makes money through the above parameters. A company that uses commissions may charge a specified percentage or the difference between demand and offer price. However, many brokers advertise that they do not charge commissions and instead earn wider spreads. For example, it may be fixed at three pips, or it will vary depending on market volatility.
Imagine that the EUR / USD 1.3943-1.3946 quote has three spreads. This means that as soon as a market participant buys 1.3946, the position has already lost three points of value, since it can be immediately sold for only 1.3943. Therefore, the wider the spread, the more difficult it can be to make a profit. In fact, common trading pairs such as GBP / USD and EUR / USD tend to have more tight spreads than more finely traded ones.
The third argument to consider when deciding which broker to choose is the initial deposit that the company can offer. Most accounts can be financed with a very small initial deposit, even up to $ 50. Of course, when using the lever, it can be significantly larger than the minimum. This is one of the many reasons why Forex trading is so attractive to new traders and investors. Many brokers offer standard, mini, and micro accounts with replaceable initial deposit requirements.
And the last thing to consider when trying to decide which broker to choose for a newbie is the ease of making deposits and withdrawing funds. Each company has its own withdrawal options, as well as a financing policy. Brokers can allow account holders to fund their accounts via PayPal, simply by credit card or by paying ACH, not to mention bank transfers, bank or business or personal checks. Withdrawals can usually be made by check or bank transfer. It is also worth considering that many reputable brokers may charge a fee for each service.
What should be stated about the proposed currency pairs?
Which broker to choose for Forex trading? In addition to the above requirements, you should determine the currencies available for trading. Despite the fact that there are a large number of them, only a few deserve close attention and, thus, trade with the greatest liquidity. The largest of them are USD / JPY, EUR / USD, USD / CHF, as well as GBP / USD. Forex brokers who position themselves as top-end brokers can offer a wide selection of pairs. However, it is of paramount importance whether they offer a pair (or pairs) in which the trader or investor is interested.
Customer Service Value
Which broker to choose for investing and trading currency? Financial trading takes place 24 hours a day, so client support for the broker should be available at any time. It should also be possible to consult with a living person, and not just spend a lot of time on calls and receive pre-recorded messages in response.
When deciding which broker to choose, be guided by the speed of support response. This can give you an idea of what kind of customer service they provide, what is the waiting time for an answer, and the ability of a representative to answer questions about spreads, positions, leverage and company information in a short form.
How to choose a trading platform
A trading platform is an investor portal that brings it to the market. Thus, traders must make sure that it, like any trading software, is easy to use and visually attractive.
Speaking about which broker to choose for trading, one should not miss the opportunity to test the trading platform. It should have a number of technical and fundamental analysis tools, and make it easy to enter and exit the auction without additional effort. This point is crucial when considering which broker to choose.
A well-designed Forex trading platform will have simple buy and sell buttons, and some even have an emergency button that closes all open positions. A poorly designed user interface can lead to errors in placing an order, such as accidentally adding to a position rather than closing it, or exiting a transaction when you intended to continue it. These inconsistencies and shortcomings can make your trading process unprofitable. Make sure you choose a reliable platform. The best choice is MetaTrader 4, as it is the most popular and functional.
In addition, other considerations that should be included when deciding which broker is best to choose include: the ability to configure, types of order entry, automatic trading options, strategy developers, as well as trading signals. Most brokerage companies offer free demo accounts so that Forex traders can try out the trading platform without any risk.
Full service or online?
Which broker to choose for trading stocks, currencies and options? The choice between full service and online largely depends on the complexity of your trading, your level of experience and the amount of time that you prefer to spend managing your money.
Almost any company operating online can easily process transactions with stock shares and any assets. In general, commissions will be much lower. Most brokers will also have a quick support service that can help you with complex trading or selling. Many investors simply prefer to control the entire trading process on the Internet and be able to place deals whenever they want.
Until recently, some Internet service providers made it very difficult or even impossible to trade foreign stocks. But this situation is changing rapidly.
For large accounts with a large number of positions, especially in thinly traded stocks, or for those who will deal with orders or special places, it is still recommended to use a broker with a full range of services. The more money you have, the more important that you are working with a company that will give you good advice and help you buy and sell in the best way.
So what to use: full service or online? For most investors, a combination is usually the best way. Take advantage of instant access and low commission to make small transactions or buy and sell large amounts of investment on the Internet. Contact a full-service broker only for more complex transactions.
The situation with the MICEX
The Russian financial market appeared in the early 1990s as a result of liberalization of the economy in the country. Since then, it has grown significantly, attracting a wide range of participants. Interestingly, only a few companies have won key positions in the Russian market. Which broker to choose on the Moscow Exchange? Some of the Russian companies are of local origin, and many world financial brands are widely known along with them.
As in other countries, in Russia, new traders prefer to entrust their money to a broker with a head or local office in Moscow or another major Russian city, that is, in actual access and with the possibility of receiving services in Russian. The growing popularity of currency and options trading in Russia was largely due to the fact that in large cities companies organize courses and seminars on this topic, sometimes absolutely free.
So, which broker to choose on the Moscow Exchange? The activities of brokers in Russia are regulated, as in all other countries. New companies entering the Russian financial market must obtain a Forex dealer license and permits to trade other assets. This is mandatory for brokers working in Russia or with Russian citizens. Regulation includes provisions for the protection of customer funds and marketing of services offered.
Which broker to choose to trade on the MICEX? Choosing the best company can be difficult without a deep knowledge of the Russian market. In general, stable firms with a good reputation and years of successful work in the market are optimal. Of these, the following are most popular.
Alfa Forex
Alfa-Forex is a major global broker focused on clients from the European Union, Russia and the CIS. Being a reliable partner for dozens of banks and financial companies, it has an excellent business reputation for a long time.
The interests of traders are protected by European standards adopted by the Cyprus Securities Regulator and the Exchange Commission (CySEC). The platform is known for constantly improving new and existing financial products that allow you to trade with high efficiency.
Alfa-Forex is an important part of the Alfa Group consortium, founded in 1989. The broker is one of the largest private financial investment conglomerates in Russia.
Partnership with Alfa-Forex, a member of the Alfa Group, allows traders to access all the benefits of working with one of the largest financial groups in Europe. Moreover, the high foreign exchange liquidity of a European bank with a rating of “AAA” allows you to freely open and close positions of any value. This means that you have no restrictions when working with your savings. This is a great option, which broker to choose for novice traders.
Alpari
Alpari is a large company operating in global financial markets since 1998. Being already a very large company with an extensive clientele, it continues to grow, and is currently one of the most popular online sites. This is a good option for those who decide which binary options broker and various assets to choose.
Alpari provides advanced trading methods, convenient and safe, intuitive market analysis tools, effective training programs and responsive customer support. Alpari has representative offices and sales departments in more than 20 countries.
The company is headquartered in Auckland, New Zealand. Alpari is licensed and regulated by financial institutions such as the Financial Services Authority and CySec. The company has more than two hundred thousand customers with active live trading accounts. Thanks to the above, the Alpari rating is quite high among traders around the world.
The broker offers private currency traders and institutional investors free and stable access to a wide range of analytical tools such as Alpari Squawk to receive the latest news in real time, market analysis data from Trading Central and Autochartist tools. The Alpari team does everything possible to ensure that customers are fully informed of the right trading decisions. Spread rates are also available in different variations.
The broker offers its customers to trade on such trading platforms as MetaTrader 4, Metatrader 5, ZuluTrade, Mirror Trade and Alpari Direct. In addition, the company provides mobile versions of the above software: MetaTrader 4/5 for Windows Mobile, Android and IOS. Trading is available on a demo account for free. MetaTrader features include the ability to create advisers for effective, automated trading procedures, a wide range of technical indicators, a full range of technical analyzes, and quotes history for testing purposes. Speaking about which broker to choose for long-term investment, this option is ideal.
TeleTrade
DJ is one of the leading financial companies in Eastern Europe and the CIS countries. The broker has more than 80 offices located in more than 13 countries of the world, which are well equipped for trade and training.
Since 1994, TeleTrade DJ has been offering its customers a wide range of advisory services that allow them to trade in global financial markets (the international Forex market and the US stock market), offering the opportunity to earn income at a much higher level than interest on any bank deposit. This is a great option for those who are looking for which stock broker to choose the best.
In addition to providing advisory services to companies and investors, TeleTrade DJ, having 12 years of experience in working with and partnership with the banking elite and combining it with the most advanced financial software products, offers training to traders and financial analysts in cooperation with universities and financial institutions in many countries.
Conclusion
There is no ideal broker in the world, but if you are confident in your choice, you will be able to devote much more time and precious attention to the analysis and development of various strategies.