7 Things To Consider When You Compare Forex Brokers
There is no doubt that the Foreign exchange market is a market that can be exciting and profitable if executed correctly. Here is the thing though; take into account all the important factors when you compare Forex Brokers, to ensure that you choose the best one.
There are lots of fundamental factors that need to be taken into consideration, and here are my top 7.
Where they are located
Whilst it might not seem relevant, company information is extremely important. Do not simply choose a company because they offer the best spread, as you are asking for trouble.
If a company is based offshore, then it will be extremely difficult to get hold of your cash!
Rules and regulations
When you compare Forex Brokers, make sure you do all the necessary research. They should all be regulated by the associated body in their home country. A company residing in the UK should be regulated by the FSA, where as the FCM is the regulator for US based companies.
The different types of account
It will soon become apparent that there are hundreds of different accounts available. Account deposits start from $10 for a micro account, mini accounts start from $300 and standard accounts start from $2,000. Corporate accounts are available, but they usually require a much higher deposit amount.
Amount of Leverage
Leverage can vary depending on the broker and type of account. Ratios usually start around 100:1 although they can go to 400:1 for a lot of micro based accounts.
Size of spread
When you compare Forex Brokers, take into account the size of the spread. If a spread size is 10-15% larger with one company, then obviously your profit will be reduced a great deal.
Different types of Trading Platforms
As far as the trading platform goes, this is down to personal preference. Make sure you know what features you need and try and few pieces of software out. Eventually you will find the right trading platform that suits you.
Support team
The foreign exchange market is one that is open 24 hours a day, 5 days a week, even a trader gets a break!
When you look to compare Forex Brokers take into account the quality of their support team and the methods of support. A lot of brokers offer different methods of support such as telephone, email and even fax.