7 Things To Consider When You Compare Forex Brokers
The foreign exchange market is a competitive one; you are not battling against others, but against price action. There are a lot of things that need to be taken into consideration when trading, but before you start, you need to compare Forex Brokers to ensure that you are one step ahead.
There are lots of fundamental factors that need to be taken into consideration, and here are my top 7.
Location, Location, Location
Do not simply choose a Broker that does not give a lot of information, just because they are offering good spreads. The reality is, there are a lot of companies looking to scam people out there, so do not let them take advantage.
Offshore companies are here, there and everywhere, but clients will find it hard to withdraw their profits.
Regulators
Not everyone knows this; each company should be regulated by the appropriate body in their country, so when you compare Forex Brokers, take this into consideration. For example, the FSA is in the UK and the FCM is the regulator in the USA.
Different account types
There are hundreds of different accounts out there, so make sure you pick the right one for you. There are micro accounts starting from $10, mini accounts from $300, standard accounts from $2,000 and of course, there are corporate accounts.
Amount of Leverage
Leverage is the ratio that is risked in comparison to cash held. A lot of places will offer anything from 100:1 right through to 400:1. This means that you can risk $400 for every $1 in a 400:1 account.
Spread size
When you compare Forex Brokers, take into account the size of the spread. If a spread size is 10-15% larger with one company, then obviously your profit will be reduced a great deal.
Types of trading platforms
The software used by a broker is essentially the trading platform. Each trading platform will offer a range of different features, so get to know a few different pieces of software to determine what features you really want a need to become successful.
Types and quality of support
This market is open 5 days a week for 24 hours and shut on the weekends.
When you look to compare Forex Brokers take into account the quality of their support team and the methods of support. A lot of brokers offer different methods of support such as telephone, email and even fax.
Article Source: FxTradingStock.com
About the Author
Learn about spreads, trading strategies and how to Compare Forex Brokers! http://www.forex-market-trading.info
by: Phillip Fanertay
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Word Count: 425
Date: Mon, 31 May 2010
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