Three Ways to Find the Forex Trading Broker That's Right for You

by Andrew McGuinness     Jul 16, 2019

Even if you're just getting started in Forex trading, you probably already know that you'll need a broker to help you trade currencies, track the market, and make money. Forex brokers main job is to provide you with a trading platform, which will become your "home base" for trading. Thus, choosing the right broker can be crucial to your success in Forex trading, while choosing the wrong broker can mean financial ruin. But with every Forex trading broker claiming to be the best, how can you tell who is trustworthy and who you should give your money to? Read on to learn three ways that you can make the search for a Forex trading broker a little easier.

Know the game before you play. There are a number of Forex trading brokers who make their money by pulling the wool over the eyes of beginning brokers. They use technical jargon to sound smarter than they actually are, and may use simple trading strategies and charge their clients outrageous percentages when chances are likely that most brokers could have made them the same amount of money with lower rates. Your strongest weapon when it comes to deciding which brokers know their facts and which ones are full of fiction is a great education in Forex trading. Before you even begin to think about choosing a broker, you should spend time learning all about the ins and outs of the Forex market. This doesn't mean that you ave to head back to university or spend all your money on a twelve week training course; there are plenty of completely free resources available that can help beginning traders get a grasp on the lingo and the nature of the market without spending a dime. More importantly, you'll be able to ask the right questions to ensure that you're working with a broker who is charging you fairly and who knows his or her stuff.

Read the reviews the right way. Not all brokerage review sites are created equal! You shouldn't totally trust reviews on a broker's blog, website, or any other arena in which they have complete control; for every good review that you see, they may be hiding ten bad reviews from your reading view! Instead, find a website that isn't affiliated with a single broker and check out some reviews. These are the most accurate sources of information, because users and reviewers do not have a financial incentive to lie or stretch the truth about their experience with a broker. This means that you'll have a higher likelihood of finding a broker that is universally liked and who charges rates that are fair.

Make sure the broker is licensed. One of the first questions that you should ask your potential broker is whether or not they are licensed as a FCM with the CFTC. The FCM is the " futures commission merchant," and CFTC is "commodity futures trading commission." These are the boards that regulate brokers and make sure that they are acting in accordance with the law. if the answer you receive is not a firm "yes," continue your search elsewhere.

At the end of the day, every broker has the same goal, which is to make their clients wealthy. If they fail in their goal, it is likely that their clients will take their business elsewhere. Use your own experience and intelligence when comparing brokers, and don't be afraid to shop around until you find the right fit!

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