Forex Currency Trading Strategies - 10 Factors For Choosing The Right Broker

Broker Guide

A broker is a firm that matches buyer and seller together for a fee or a commission. In the forex, a broker takes your order electronically and executes it instantaneously. There are no commissions involved like in other markets. The broker only takes the spread, the difference between the bid and the ask price of the currency.

currency trading, forex The following are 10 factors you might like to consider when choosing a broker. You can use this guide as a checklist to narrow down on a selection of forex brokers and focus in on a couple of key firms. There's plenty of useful information to be found to help you choose the broker that's right for you.

1. Word of Mouth

What do other traders say about the broker?
What is their customer service/dealing desk like?

2. Safety of Funds

Is the broker regulated?
Are client funds insured?

3. Execution

How fast is the broker's order execution?
Do they offer automatic execution?
How much can you trade before having to request a quote?
Do they trade against their clients?

4. Spread

How tight is the spread?
Is it fixed or variable?
Is it larger for mini accounts?

5. Slippage

What slippage is to be expected in normal and fast moving market conditions?

6. Margin/Leverage

What is the margin requirement? Higher leverage will often work against you.
Is it calculated on the notional value of the transaction, or a fixed dollar amount per lot?
Does it change for different currency pairs or days of the week?
Is it the same for standard and mini accounts?

7. Commissions

Does the broker charge commissions?

8. Rollover Policy

What is the broker's policy on crediting/debiting interest to your account?

9. Trading Platform

How reliable is it during fast moving markets and news announcements?
How many different currency pairs can you trade?
Do they offer automated systems trading through an Application Programming Interface (API)?
Does it have any additional features? e.g. Trading from the chart, trailing stops, etc.

10. Account Size

Can you trade mini accounts?
Can you adjust the standard lot size traded?
What is the minimum account balance?

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		Broker Guide A broker is a firm that matches buyer and seller together for a fee or a commission. In the forex, a broker takes your order electronically and executes it instantaneously. There are no commissions involved like in other markets. The broker only takes the spread, the difference between the bid and the ask price of the currency. The following are 10 factors you might like to consider when choosing a broker. You can use this guide as a checklist to narrow down on a selection of forex brokers and focus in on a couple of key firms. There's plenty of useful information to be found to help you choose the broker that's right for you. 1. Word of Mouth What do other traders say about the broker? What is their customer service/dealing desk like? 2. Safety of Funds Is the broker regulated? Are client funds insured? 3. Execution How fast is the broker's order execution? Do they offer automatic execution? How much can you trade before having to request a quote? Do they trade against their clients? 4. Spread How tight is the spread? Is it fixed or variable? Is it larger for mini accounts? 5. Slippage What slippage is to be expected in normal and fast moving market conditions? 6. Margin/Leverage What is the margin requirement? Higher leverage will often work against you. Is it calculated on the notional value of the transaction, or a fixed dollar amount per lot? Does it change for different currency pairs or days of the week? Is it the same for standard and mini accounts? 7. Commissions Does the broker charge commissions? 8. Rollover Policy What is the broker's policy on crediting/debiting interest to your account? 9. Trading Platform How reliable is it during fast moving markets and news announcements? How many different currency pairs can you trade? Do they offer automated systems trading through an Application Programming Interface (API)? Does it have any additional features? e.g. Trading from the chart, trailing stops, etc. 10. Account Size Can you trade mini accounts? Can you adjust the standard lot size traded? What is the minimum account balance? Back to Home Page