Without a broker to mediate your trades there are very limited ways to enter the markets. Brokers are essential to your trading success, however I must emphasize that brokers are not your friends. They make money of the demise of traders hence it is important as a trader you choose the broker that gives youre the best winning chnaces. The following is a quick guide on how to select the best broker for you and ways to avoid getting scammed.
To make your broker selection easier here are some quesitons to consider
1) Is this broker regulated？
There are a number of governmental bodies that specilize in regulating the activities of brokers. Brokers can devise many way to steal your money hence these regulatory boards ensure that these brokers offer fair trading conditions and offer channels through which a person can report any malpractice of a broker. Unregulated brokers represent a risk for you as a trader as they are unmontiored by a third party. This gives them leeway to cheat you out of your money and withhold your withdrawls. Be sure to find out if a broker is regulated in some fashion as you want your rights to be protected.
2) Does this broker offer trading accounts in your home currency？
It is important to find a broker that trades in the currency that you use in your country. There will be additional costs that you incur if you are constanty switching between currencies from when you deposit and when you withdraw. It is recommend that you trade with the currency that you deposit in your bank account to avoid conversion fees. It will also help you set appropriate trading targets.
3) What kind of spread does the broker offer and how large is it？
A huge spread is your worst enemy when trading. It can make trading that much more difficult. The spread will determine how many pips you will need to aquire before you can see profits as this is the additional profit of the broker. Spreads come in two forms, Fixed and Variable spreads. Fixed spreads mean that the spread figure quoted by the broker will always be maintained no matter the trading conditions. Variable spreads mean that the spread figure will increase or decrease depending on market volatility. You want to avoid variable spreads as brokers increase the spread right before major market volatiltiy to stop out traders. This will also mean you will get terrble market entries and have difficulty moving your trading stoploss as it has to be placed even further than usual. The best brokers have low fixed spreads and those are the ones you should be looking for.
4) What are the general reviews of the broker you want to use？
Any broker that you use must have an established industry presense that spans years. This allows you to do more research on a broker and find consumer reviews before you invest. You always want to find out how responsive their customer service is as they will be your only way of communicating with the broker. Scamming brokers are very common however they cannot last very long as soon people start complaining and stop using their services. You always want to avoid new brokers as they have not yet established a reputation that you can rely on.
BONUS TIP
To cover all these aspects of finding a good broker I recommend you download the WikiFx App. This tool is connected to all the regulatory board in the world so they keep a list of the best rated brokers that you can choose from. They also show you a live stream of the current spreads that brokers are offering so you can compare them and select the broker with the lowest spreads. If for some reason you are not happy with your current broker you can report it through WikiFx and they can help you recover your money if your funds have been mishandled. This app is the one stop shop where you can get all your broker related troubles sorted out and it is completely free so you have nothing to lose. Search for WikiFx on your app store today and start saving today.
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