Before you can begin trading foreign currencies online, you have to open an account with a brokerage firm and it’s very important to research the firm thoroughly before deciding on which brokerage to work with for your financial investments. There are innumerable online brokerage firms these days and there are several points to consider before finalizing your choice and opening a trading account. The professional investment traders at ForexSQ.com have compiled the following criteria to consider and reviews of the best forex brokers for your convenience in deciding which brokerage firm is right for your particular investments. Our team will show you how choose the best online forex brokers so read this article to the end.
How to Find the Best Forex Brokers
Your main objective in hiring a broker is to find someone you can trust to handle your trades. The broker of your choosing should have a good reputation with past customers, have few or no instances of accounts behind hacked by outsiders and realize the importance of confidentiality in managing your trading account. Although it is impossible to predict future success, especially in investment markets, the broker you choose should have a satisfactory history of placing winning trades on behalf of the customers they represent.
Don’t fall prey to brokers who offer “sweetened” deals that may work out well for the broker, but not so well for you. This often occurs when management of brokerage firms offer salary incentives or bonuses to brokers to draw in new clients with discounted pricing for investments that have not realized much success.
Criteria to Consider in a Broker
For your convenience in reviewing potential brokers, the ForexSQ team of professional investment advisors has compiled the following information that is extremely important to consider when choosing a broker to invest your hard earned money in financial markets.
Discount or Full Service Broker
The first thing to consider is whether you want a discount broker or a full service broker. The difference is simple … a discount broker costs less and only conducts trades on your behalf and a full service broker costs more and conducts trades, as well as giving the investor access to the full wealth of investment data gleaned by the broker and brokerage firm and expert advice as to the investor’s personal financial future.
Most brokerages firms offer several different kinds of trading accounts to their clients. If you are new to trading in investment markets, you should initially open a demo account with a broker, which will allow you to learn the broker’s trading platform and virtually conduct trades before actually placing trades using real money in real market platforms.
A demo account is very important for practice and developing knowledge and experience in the world of investment trading where real time losses can be very detrimental to your portfolio, not to mention your financial future.
Accounts vary between brokers, but most offer demo accounts, in addition to small accounts designed specifically for newbies, standard accounts and VIP trading accounts for the more seasoned trader.
Minimum Required Deposits
Every broker requires minimum balances to be maintained in an investor’s trading account and those required minimums vary from broker to broker. Even when opening a demo account, brokers will require your information or other security in order to open a demo trading account.
Standard accounts are opened by more knowledgeable traders and these accounts usually involve modest minimum deposits of trading assets (in the form of cash or other security).
For the more seasoned trader, brokerage firms offer VIP and Gold accounts with larger minimum deposit requirements than demo or standard accounts.
Typically, the more money you deposit into your trading account, the more features are made available to you by the brokerage firm.
The best online forex brokers provide their own trading platforms for investors to use to conduct and track forex transactions. The trading platforms used by brokers vary and include web-based platforms accessible through your computer’s internet browser and trading platforms that the customer downloads onto his own individual computer.
Many countries have no government regulatory agency overseeing financial markets and you would be wise to avoid trading in those countries.
In the US and UK, you can place trades with the comfort of knowing that the process is being overseen and regulated by one or more government agencies whose purpose is to ensure that investment trading by brokers is conducted fairly and legally within the bounds of the standards set by the governing authority.
When choosing a broker for online forex trading, make sure the broker offers a wide diversity of foreign currency pairs. The more currency pairs you have to choose from, the more opportunities you will have to conduct potentially profitable forex trades.
Some traders would also like access to trading in other equities, as well, such as precious metals like silver and gold, or crude oil, etc.
Selling prices are determined by owners who want to sell assets they currently possess and bids are the amounts offered by others who want to buy assets owned by another trader.
In forex trading, the “spread” is the difference between the price fluctuation of the asking (selling) price and the bid (buying) price of a currency pair during a certain period of time. That fluctuation in price in forex trading is referred to as a pip (percentage in point) and should ideally not exceed five pips. For example if EUR/USD changes from 1.2250 to 1.2251, the increase in value of the USD is considered one pip.
Leverage and Margin Call Policies
For purposes of this discussion, leverage is basically a loan from a broker to an investor for the purpose of realizing or increasing potential returns on various investments. This leverage can be in the form of borrowed capital or financial security instruments and most brokerage firms use leverage to finance their own trading operations. A brokerage firm whose total debt is more than its equity is considered “highly leveraged.”
A broker issues a “margin call” when the balance in a trading account goes below the predetermined minimum required to maintain that account. Once a margin call is issued, you have to deposit more money or other financial security into your trading account to bring it back up to the minimum required balance.
Policies vary between brokers, but the broker can immediately stop all trading if minimum account balances are not met, or use the first in first out (FIFO) method of ending trades or the last in first out (LIFO) method. The bottom line is that failing to deposit additional funds into a trading account once a margin call has been issued will result in all trades stopping.
Assignments and Monetary Transactions
It’s important to know a broker’s policy on assignments and transactions involving the transfer of money.
Assignments refer to the transfer of all or part of property rights and obligations from one party to another. A simple example is an investor assigning rights in a note to a bank so the bank can process payments received on the note.
Best Forex Broker Provides Managed Accounts
Currently Fxstay team provide the best forex managed accounts service in the market. In a managed forex account you don’t need to trade and professional hedge fund managers and a group of forex traders will handle trading for you, After the managers team make profit then share it with investor.
Mini-managed accounts can be opened with a minimum deposit of $1000, retail managed forex accounts can be opened with a minimum of $10,000 and VIP accounts require a hefty minimum of $100,000.
For the more affluent investor, VIP forex managed accounts can open with a minimum of $1,000,000 and these expensive types of accounts are typically managed by two teams of eight hedge fund and forex managers.
Wealthier investors can open Gold VIP forex managed accounts with a minimum deposit of $10,000,000 and these Gold accounts are usually managed by three teams of twelve hedge fund and forex managers.
Best Online Forex Brokers List In UK
Fxpro Forex Broker Founded in 2006, London-based FxPro is an online broker offering Forex trading along with CFD’s. The MT4, MetaTrader5 and cTrader online trading platforms are available.
Referral to the Best Broker Forex
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