Are you trading with the right broker?

[melaniehamilton]

It is recommended that the broker has a free demo that operates in real time because we can practice and learn with play money.

[janks_peter]

To make money at foreign exchange trading you must deposit some of your hard earned money with a forex broker. But which broker do you go with?

Choosing a broker can seem like a never ending task. There are just so many of them; they all seem to use different trading platforms and offer seemingly magically huge leverage of 100:1 or 200:1, where you can control vast amounts of money against your measly small deposit (if it isn’t totally obvious to you already, this is the broker appealing to your greed, so beware!).

It helps to have a few guideposts in place to help whittle down the brokers to ones that you might actually give your money to.

There are eight main factors I like to consider that make up these guideposts:

[B]1. Regulatory oversight[/B] - is there a government watchdog that is keeping an eye on the broker to make sure they aren’t breaking any rules?

[B]2. Safety of your funds[/B] - how does the broker hold your money? Are they adequately insured?

[B]3. Leverage/Margin/Gearing[/B] - does the broker allow you to use the appropriate amount of gearing that your trading system requires? Don’t be swayed by the offer of extra leverage if you don’t really need it.

[B]4. Lot sizes[/B] - are you able to apply your money management strategy given the amount of your deposit versus the minimum lot sizes that the broker allows you to place?

[B]5. Interest/swap rates[/B] - if you have to hold trades for more than a day, what rates of interest do you get on your position? This is especially important for more long-term traders.

[B]6. Ease of use of software[/B] - do you like the trading platform provided by the broker? Are you able to use it competantly? Do it have all the features that you need to follow your strategy?

[B]7. Reports[/B] - are you able to generate reports that display a complete and accurate history of your trading activity? Having access to your trading history is very important in being able to track your performance to see how you are improving.

[B]8. Telephone support[/B] - always have a back-up. You never know when there might be a problem with your computer, ISP, your broker’s server or any electronic component in-between. Know your broker’s dealing desk number and make sure you know how to talk to them about your positions.

I look at each of these eight factors in more detail in the post on my blog entitled Are you trading with the right broker?.

Are there any other factors that you always use when comparing which broker to use? What criteria do you use to determine if a broker is worthy of getting you as a client?

To add to what you have said, i think we can also determine if a broker is suitable for us after we must have traded with them. So even if we considered the above, we might still not like things after sometime. There is no rule that we should stick to a broker forever. So it all depends on what we want and need.

[johnpiptrader]

There is something missing from the list. You did not mention the covering model of the broker. For example, is the Broker acting as a market maker or as a STP/ECN?

[GOFX]

I have noticed that a few brokers are now starting to add commission to the low spread. For example YouTrade FX.

[Forexlight]

I really need advice too. I don’t really see much sanctification in a regulated broker.I’m beginning to see that regulation literally brings ACs (air conditioners) into the FX; promoting an ill sense of comfort. Such that clients forget every slot they accept is a slot in the financial trenches of the FX. And they have to stay alert however uncomfortable to fight the currency war. Yes, FX is battle, and there is no need for an NFA peacekeeping. Don’t we enjoy it so?

[Forexlight]

I think I am. I rightly trade with an unregulated broker. I’m thinking about a more civilised FX with no broker discrimination. I don’t really see predatory claws in an unregulated broker. The reason why fraud is very close to the market is because ignorance is also close and even largely resides in the FX. To get margins safe alive and kicking, you must first kick negligence out of your FX attitude. Else you may lose your money you have earlier lose your awareness. There is so need for regulatory to generously (like some FX Akon) take the blame for the recklessness of traders.Can I say regulation (or FX sanitation) is supposed to be a collective traders responsibility not a reserved NFA or so affair?

[Forexlight]

Yeah I have a mouthful of confidence in my unregulated broker. Don’t we think true regulation starts from within? It is not our lovely FX that needs regulation, it is our consciences. Yet we can’t all be moralist especially in this age when virtues are going extinct. It therefore all boils down to diligence and a serious FX monitoring; get your FX radars up else have your margin heavily bombarded. Please am I right?

[robocop77]

The best ECN is NDD account in liteforex, I’m salute with its fastest execution and its order.

[Vaibhav_Sinha]

seems that everyone are promoting brokers here

[daytrad]

Hey David, I have never heard about this Kerford investment before, where are they from?

[Jblack4083]

It is important to know whether your broker is using the Dealing Desk or Non-Dealing Desk model for order processing.

[george5]

this is great advice for choosing a good and reliable online forex broker. there are so many online broker. they are very important to choose a forex broker online.
I personnaly I base on six things to choose a broker:
the regulation
Security of your funds
Leverage / Margin / Gearing
Lot sizes
Easy to use software
Telephone support