There are hundreds of different forex brokers on the Internet; way too many to keep track of thoroughly. And each one offers something different and targets a different kind of customer.
This occurs when a larger, more established broker allows other smaller providers to use the larger broker's products. This allows smaller forex providers to build up their own business model without having to develop their own proprietary trading products.
Meanwhile, the established broker gets to keep a big cut of the commissions that the white label provider brings in. It’s a win-win business model as both parties benefit from the collaboration.
However, just because a forex service is white label, and ultimately providing the same service as another, does not mean you should trust that broker complicitly. White label forex providers can still change their spreads and charges and this will make some more attractive than others.
But why are there so many?
Well, one reason why there are so many different forex providers is due to white label licensing.This occurs when a larger, more established broker allows other smaller providers to use the larger broker's products. This allows smaller forex providers to build up their own business model without having to develop their own proprietary trading products.
Meanwhile, the established broker gets to keep a big cut of the commissions that the white label provider brings in. It’s a win-win business model as both parties benefit from the collaboration.
However, just because a forex service is white label, and ultimately providing the same service as another, does not mean you should trust that broker complicitly. White label forex providers can still change their spreads and charges and this will make some more attractive than others.
Reputation
The first thing to look for when joining a forex provider is the reputation of the company. And if it’s a white label product then you’ll want to look at both the white label provider and the primary broker. Does the provider have all the necessary legal accreditation and is it well thought of within the industry? Forex trading Internet forums can be invaluable in finding out from other traders which brokers are the best to use.Longevity
While it’s not set in stone, a useful guide to judging a forex provider is how long the broker has been in action. Forex brokers that charge high commissions and generally rip off traders rarely last long in this industry. In fact, since a forex broker can be set up as a white label product for a very small cost some brokers may not even intend to last all that long. Legal changes have helped stop this kind of thing but generally, longevity is a good thing to look out for in the forex market.
Editors’ Picks
EUR/USD steadies near 1.1750 ahead of final Eurozone CPI amid fading USD recovery
The EUR/USD pair steadies around the 1.1750 area during the Asian session on Wednesday, and for now, seems to have stalled the previous day's sharp retracement slide from the highest level since September 24. Meanwhile, the fundamental backdrop remains tilted in favor of bullish traders and suggests that the path of least resistance for spot prices remains to the upside.
GBP/USD gains ground above 1.3400 on UK PMI optimism
The GBP/USD pair gains momentum to around 1.3425 during the early Asian session on Wednesday. The Pound Sterling edges higher against the Greenback on the upbeat UK preliminary S&P Global Purchasing Managers' Index data. Traders will take more cues from the Fedspeak later on Wednesday.
USD/JPY bounces to 155.00 as Japanese Yen sees pre-BoJ profit taking
USD/JPY is back on the bids, retaking 150.00 in the Asian session on Wednesday. The Japanese Yen sees fresh declines on profit-taking ahead of Friday's BoJ event risk, while the US Dollar recovers following the mixed US jobs data-led sell-off. Fedspeak awaited.
Editors’ Picks
AUD/USD consolidates near weekly lows below 0.6650
AUD/USD trades with a negative bias for the fifth straight day early Wednesday, close to weekly lows below 0.6650. A softer risk tone, China's economic woes and a broad US Dollar bounce undermine the Aussie. However, the downside appears cushioned by the hawkish RBA outlook and commodities' uptick.
USD/JPY bounces to 155.00 as Japanese Yen sees pre-BoJ profit taking
USD/JPY is back on the bids, retaking 150.00 in the Asian session on Wednesday. The Japanese Yen sees fresh declines on profit-taking ahead of Friday's BoJ event risk, while the US Dollar recovers following the mixed US jobs data-led sell-off. Fedspeak awaited.
Gold advances to near seven-week highs amid US labor market cooling
Gold price extends its upside to near seven-week highs above $4,300 during the Asian trading hours on Wednesday. The precious metal gains momentum as the US labor market remains relatively resilient but shows signs of slowing. The mixed US employment report for November reinforces bets of further rate cuts by the US Federal Reserve and weighs on the US Dollar.
WTI climbs above $55.50 as Trump orders blockade of sanctioned Venezuelan oil tankers
West Texas Intermediate, the US crude oil benchmark, is trading around $55.75 during the Asian trading hours on Wednesday. The WTI price climbs amid rising volatility around Latin American crude supply. Traders await the release of the Energy Information Administration crude oil stockpiles report later on Wednesday.
Ukraine-Russia in the spotlight once again
Since the start of the week, gold’s price has moved lower, but has yet to erase the gains made last week. In today’s report we intend to focus on the newest round of peace talks between Russia and Ukraine, whilst noting the release of the US Employment data later on day and end our report with an update in regards to the tensions brewing in Venezuela.
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