How to choose the Forex Broker that suits you
|At least once a week, here at ForexSQ I get an email from an user, asking me to recommend him/her a broker. To be honest, choosing the right broker has become less complicated over time, but it could still be quite tricky for a beginner. The worldwide web is overflowed with articles about the issue, but you can put it all down to one single word: trust. If you can't find a reliable broker, then you are doing something wrong.
Let's start by understanding what's a broker. A broker, according to the official definition, is a person, or company, who "buys and sells goods or assets for others." When it comes to the FX market, brokers are the intermediaries traders need to connect to the immaterial worldwide foreign exchange market. You can't access the market without them , they can't exist without us.
There are plenty of firms that offer their services, so, how to choose the one that's right for you? Well, before any other thing, the broker needs to be registered before an official governmental agency, to be regulated. Remember, your first objective in the investment world is not to make money, but to protect your capital. A regulated broker has to fulfill certain legal conditions, present, balance sheets, etc. Generally speaking, they have to be able to provide information about the company's health for everyone to see. Also, and when it comes to regulations, remember, if the broker is in the same country as you are, you have more legal protection.
These days, there is not one single company, inside or outside the forex world that is "too big to fall," but it you can find a brokerage that can prove it has a strong performance, well, there you are walking in the right path.
Of course, there are couple of more things to take care off: I would say that the next thing you need, is a solid platform. A responsive web, easy to use that provides a good number or assets. A great customer service it's also important-
What is not actually relevant, is the spread they offer. These days, spreads are quite tight for almost every currency pair, and the difference between one broker and the next one, sometimes is less than a pip. You can't choose to whom you are giving your money based on half-pip difference in the EUR/USD pair's spread.
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