Picking the right Forex Broker
If you are ready to trade in the forex market, you need to engage a forex broker to help you get into the market and earn something out of it. There are hundreds of brokers in the market which you can use but how would you know which is the right one? Here are some pointers.
Your trading style
You must first consider what resources you have and your trading styles. From there, you will know what you need from your forex broker. You have to determine what type of trading you intend to carry out. This can only be done after some research. If you do are working with a few thousand dollars, then you will be trading in micro lots and that will determine which broker will be suitable.
Moving of funds
Not all brokers are based in the country of your residence. You need to know how you will be moving your funds. Most forex brokers will allow you to transfer money in for trading but what about moving out? If you want to cash out, is it going to be as easy as cashing in?
Picking a forex broker with competitive spreads might be quite challenging. This is because forex trading usually do not involve commissions like stock trading. Traders are usually required to pay a spread which is what the broker earns. Some have fixed spreads while variable spreads are practiced by others. This is the difference between the bid and the asking price and you need to know what the spreads are being offered by the forex broker before you engage them.
While the best (and easiest) way to pick a forex broker is by reviews and what people have said about them, it might not be the most reliable. In fact, you should not put your judgment in what you read around. The best way to know if the broker is right for you is to learn about it yourself. Find one with a live demo account which will give you the right feel about the market. If you like that experience, start with a small sum and then work your way up.