There is no shortage of Forex brokers online and each one of them feels that they are superior to the rest. This can present a daunting challenge to traders hoping to make their mark in a Forex trading game by selecting a broker that is best suited to meet their unique requirements.
There are a number of things that must be taken into consideration when selecting a broker. The most important are,
- Initial Deposit
- Deposits and Withdrawals
There is little sense in opening a trading account if deposited funds are not secure with the broker. A reputable broker will have a clear history and successful track record. Furthermore, they will be a member-in-good-standing with a financial regulatory authority.
While most new traders would prefer to keep their initial investment smaller until they ‘get their feet wet’, many well-qualified brokers choose to keep initial investments higher in hopes of ensuring that they are only signing on the most serious traders. Unless you only have a minimal amount of funds, the initial investment should be one of the last things considered when deciding on a broker.
In the Forex world, spreads are of utmost importance. Given that brokers receive commission for their services by widening the bid-ask spread past quoted values, a wide bid-ask represents a larger sum of money being taken from the profit margin and given to the broker. Traders are required to pay this fee regardless of whether they gain or lose the trade.
Deposits and Withdrawals
It is never wise to trade Forex if it is difficult (or impossible) to easily withdraw earnings. Ultimately, the broker you choose to work with must facilitate account termination in the event that you are not satisfied with the services they offer, regardless of whatever reasons for account closure you might have.
On the other end of the spectrum, there should be no problems with the depositing fund with the broker. If the deposit process is not an easy transaction, it is unlikely that the broker is capable of ensuring a great trading experience.
These are only a few of the things that novice Forex traders must be wary of when researching and selecting potential online brokers. With a little research and a well-thought list of criteria, it is possible to enjoy a safe and profitable trading experience.