In the market where there are a lots of brokerage firms, most if not all will tell you that they are the best you can find in the market. But would you believe if all of them tell you that? You might not want to.
Before choosing a broker you need to identify and understand what kind of broker would suit you the best.
Here are some important qualities you might want to consider:
Registered with a Regulating Authority
This is to ensure that the broker has the license to operate and they act and handle all the deposits in accordance with all the accepted codes of conduct.
After all you wouldn’t want your hard earned money to be used somewhere else, right?
Here is the list of regulatory agencies for each country.
Would you not worry if the broker put your funds in the same bank account as theirs? You should, since your broker can use your funds to their own benefit.
Fund safety and segregation are usually associated with regulated broker. A good and reputable broker usually keeps their client funds in a separate bank account, and has compensation schemes to further protect the your fund should a misfortune happens.
The Transaction Cost
No matter which currency pairs you trade, you will always be subjected to transaction costs. You will need to pay a spread for every currency pair you trade. There are brokers who offer fix spread and floating spread; therefore, it is important to check which kind would suit you the best.
Some broker might charge you less spread for a trade, but don’t be blinded by it, you still need to check if that broker is a reliable one. Remember to not sacrifice a broker’s reliability for a lower spread. Find a balance.
Deposits and Withdrawals
A good Forex broker would let you deposit and withdraw your funds hassle-free.
After all, broker only holds your money to make your trading easier. They should not have any reason to make your deposits and withdrawals hard.
Platform aren’t perfect as you might want to think, so when a problem arises you will need to contact your broker about it.
Think about the characteristics you would like a support team to have. Do you want a prompt response? Can you contact them not only by mail but also by live chat and telephone? Are they capable of answering your questions?
There are brokers who do their best to get you open an account with them, but their support after is terrible. The best way to check is to open a demo account with them (usually free) to try their service out.
Before opening an account, you must perform you due diligence first to know which one of the available brokers you are comfortable dealing with. Open a demo account to get a feel of the broker’s platform.