Not too long ago, we talked about how forex trading has changed with the times. There are more online trading platforms to choose from, plus you have more access to forex markets these days. It is also worth noting that there are more female traders banking great profits in the forex market today.
If the opportunity to make money in the forex market interests you, the first thing you need to do is find a good online forex broker to engage. There are plenty of brokers to choose from and picking one that suits you best can be a challenge.
Overcoming that challenge is exactly what we are going to do in this article. There are four things you need to consider when choosing a forex broker.
Trading Platforms
Different forex brokers offer different trading platforms. While MetaTrader (MT) is still the most popular trading platform on the market, top brokers like Pepperstone and FxPro also offers other platforms you can use, including cTrader and Orex Platform.
Choosing a trading platform that you are comfortable with the most is a must. If you want to use scripts and custom indicators, for instance, you’d be better off using MetaTrader, either MT4 or MT5, as the trading platform of choice.
Regulations
Next, you want to check whether the forex brokers you compare are regulated. InvestinGoal has a list of top forex brokers regulated by the UK’s Financial Conduct Authority or FCA. You can visit the complete list on https://investingoal.com/ to find the best options to look into.
Regulated forex brokers play by a strict set of rules designed to guarantee a safe and pleasant trading experience every time. Working with regulated brokers also means protecting your investments from the moment you enter the forex market.
Leverage
Leverage is an interesting feature to use when trading foreign currency pairs. It basically multiplies your initial margin – your starting capital – to allow for bigger trades with smaller capital. However, leverage is a two-edged sword that can also harm your investments.
Ideally, you want 1:1 to 1:500 leverage when trading forex. Bigger leverages will only add more risk, so stick to this range for a nice balance between risk and potential returns. Once you start amassing profits, you can lower your leverage to further protect your investment.
Account Type
There are multiple account types to choose from depending on the brokers you work with. A Non-Dealing Desk (NDD) account is the best kind since the broker isn’t operating its own account. What the broker does is forward your trades straight to the market.
ECN accounts are classified as NDD accounts. The opposite of NDD is a market maker, which means that the broker also buys and sells forex pairs for its own account. Aside from processing your trades, market maker brokers also place trades for themselves.
Cover these four basics and you will be able to find a good broker to try. Creating an account and making an initial deposit is very easy too. You’ll be looking at charts and opening positions in no time at all once you have found a good forex broker to use.
KJ