How to choose your Forex Broker
It’s extremely common for traders to use multiple brokers and quite often traders are always in search of a new broker. You might wonder why traders are obsessed with jumping from broker to broker so we have dissected exactly why. The main reasons you should always be searching for a new broker are as follows:
• Better trading conditions: Better spreads, or better execution of your orders. Less slippage, no trading restrictions such as trading during the news and more. The better the conditions the more money you will make or the less you will lose.
• Better promotions: Cashback, deposit bonus, no deposit bonus, trading contests, free EAs, additional trading reports, free signals, raffles. Basically anything that can help you with your trading
• Better protection: Traders managing a portfolio of more than £50k GBP will find it difficult to find a broker offering bankruptcy protection for their entire deposit. Therefore, those clients are best served by diversifying their deposits among several brokers.
• Follow the trend: Sometimes the decision of selecting a Broker is based on brand reputation itself. If a specific Broker pops up on every website, in every forum and is discussed by large numbers of traders then its highly likely we will find ourselves signing up with them to see what the fuss is all about.
• Forums: It’s quite common to have brokers discussed extensively in the forums and people often share both good and bad experiences with their brokers. This public documented opinion is quite often a strong driver behind traders making decisions to sign up with specific brokers.
• Better support: Let’s face it. If our broker fails in the support department it can lead to whole load of worries. Therefore, traders switch brokers often because of poor support offered by their existing broker and they are in search of something better. We might select the Broker even if the specific broker is not offering the best conditions for our trading
• Fast deposits and withdrawals: The speed of funding and especially withdrawals became a sensitive issue especially with the near instant payment methods that exist. Delayed withdrawals can provide huge question marks in a traders mind and when some brokers offer same day withdrawals there is a compelling reason to process timely payments.
• Business model they follow: This is crucial. We prefer to go for ECN/STP brokers as the brokers interests are in line with ours.
So you need to make sure that when you decide to choose a new Broker you have a clear on what we mention above and understand what is important to you. All Forex traders generally have their own unique set of requirements they are looking for in a broker. As more and more new brokers emerge on what seems like a daily basis choosing the right broker is proving to be a headache, mainly because there are too many options!
You should be aware that brokers sometimes provide misleading information especially when you contact them and you get through to a sales rep, which might not be as knowledgeable as you are. Never forget that the sales rep is always paid in commissions on either your net deposits or the volume you produce. Either way, some sales reps will do anything they can to convince you to trade with them.
Our list will help you ask the right questions before you decide on any broker. Even if you do make the wrong choice you shouldn’t be disappointed as you are likely to have learned something along the way and there is nothing to stop you from switching.