We’ve had people ask us how to select a Forex broker for online forex trading. Here we shall discuss in detail what we think you have to know about selecting a forex broker.
Low Spreads or Transaction Fees
Online Forex Trading Transaction costs are calculated in pips. The lower the better. Generally, spreads are currently between 2-5 pips on average. Be mindful of forex brokers advertising 0 pip spreads. They are likely charging fees in some other way.
Leverage Options and Margin Requirements
Leverage could be a positive thing, or perhaps a bad thing, depending on how you employ it. Better brokers broker forex terbaik may have different leverage options, meaning a choice of leverage ratios. Perhaps a 400:1 leverage ratio is too high for you. Do they have a 200:1, or 100:1 option? You’ll need a forex broker that could provide leverage values you want.
Most online forex brokers pay interest on a trader’s margin account. Remember that a lot of forex brokers do not enable you to accrue interest unless your margin requirement is at the least 2% (50:1).
Forex Brokers Customer Service
Next to nothing is really as valuable nearly as good customer support, especially with online forex trading. Even though you don’t use it, you ought to have access with a minimum service requirements. Does the Forex broker have 24-hour support? Can you contact them by phone? Email? Chat? When you talk in their mind, do the people seem knowledgeable? A word of caution… service could be better before you open and fund an actual money account. If you learn that to function as case, withdraw your cash and move on to a new forex broker.
Quality of the Forex Broker
You wish to be sure you have a good broker. Forex brokers are not necessary to be registered or regulated with any agency, considering that the Forex market is defined as an “unregulated” market. However, the higher brokers will typically be registered as a Futures Commission Merchant (FMC) in addition to being regulated by the Commodity Futures Trading Commission (CFTC) and a member of the National Futures Association (NFA).
Forex Brokers Trading Tools and Research
Better brokers have trading tools designed for their account holders to help them inside their forex trading. Also, most brokers may have some type of research available or displayed on their trading site.
Online Forex Trading Platform
Most, if not totally all, Forex brokers allow trading on the Internet. The backbone of any online forex trading platform is their software system and as a result is quite important.
Forex Brokers Available Currency Pairs
Ensure that the prospective broker offers, at minimum, the seven major currencies (AUD, CAD, CHF, EUR, GBP, JPY, and USD).
Minimum Trading Size Requirement
How big is one lot may differ between forex brokers, spanning from 1,000 to 100,000 units. If you’re only starting an account with a couple hundred dollars, you’ll want to find a forex broker that allows mini lot trades.
Rollover Charges, Interest, or Swap Fees
Rollover refers to the process of closing open positions for today’s value date and opening the same position for the next day’s value date at a price reflecting the difference in interest rates between both currencies. This is also called Interest or Swap Fees.
Forex Broker Trading Hours
Online forex trading occurs 24 hours a day between Sunday evening and Friday evening, which means you may wish to select a forex broker that allow you to trade during all market hours.
You can take a look at our recommended brokers section to see some of the forex brokers that people feel are worthwhile. Also, you are able to download our free Forex Broker Checklist to use for your broker search.