The right of choosing a Forex broker can be a difficult task. Many brokers are registered in the regulation of the countries. Other brokers charge too much for the spread. Worst of all is that some brokers are just scam artist, and you may never see your hard earned money again. What this means is that, regardless of how good your trading strategy is, a runner may affect your benefits and even your way of life as a forex trader.
What follows are just some guidelines to help you select the right broker.
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Is the broker regulated? In the united states, all riders must be registered and regulated and, in addition, brokers that are not registered in the united states can not do business with the traders of the united states. Although I am in disagreement with this policy, On the understanding that the present regulation is intended to protect traders from unscrupulous brokers. Bottom line, make sure that your agent is registered in a regulated country.
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Competitive Spreads: Forex brokers usually do not charge a commission. Instead, the agent load is based on the spread. It is very important that you choose a reputable broker who charges very little for the spread. For example, eToro (a well-recognized and broker), charges from 3 pips for the EUR/USD spread, where Avatrade charges.7 points. Those charges add up and, over time, it may mean that you overpaid thousands of pips for choosing the wrong broker.
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Re-quotes: If you place an order and a message appears asking if you want to proceed to a new price, this change in price means that you were “quoted again”. Although this may happen on occasion, some brokers make a living out of the re-quotting, and you should stay away from them. When selecting a Forex broker, make sure that the honor of the quoted spread most of the time.
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Reputation: As mentioned before, a reputable broker does not constantly requote its spread. More alarming are the runners that will not make your money available on demand. What good do you get from a great strategy if you can’t get your money? There are a couple of scammers on the market that portray themselves as a trusted agent and you must make sure that you stay away from them.
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Accessible: make sure that your brokers customer support is accessible and responsive. Before opening an account, contact their customer support by email and phone, and to see/prove how sensitive they are to your questions. If they do not respond to get your business, you can expect even worse service once it has been blocked as a client.
These are just some guidelines and you should do your due diligence. Despite the online reviews are great, you must have caution when reading them, because some of them are sent by the runners themselves. I stayed away from a broker due to the very mixed reviews and the tone/text of the good reviews that were obviously written by the same person. With all the bad said, I should say that there are many broker in the market, you should make sure to do business with one of them.