Forex trading can be challenging, even to the most experienced traders. It is, therefore, important to ensure that you have the necessary determination and emotional muscles to deal with the possible frustrations of trading. If you have already made up your mind that forex trading is the right direction for you, then the next step is finding the best forex broker to work with. This step is crucial if you are to successfully avoid fraudsters who have a lot of experience stealing from unsuspecting beginners in forex trading.
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There are certain factors that ought to influence your decision. These include:
Security of Your Money
Go for a forex broker who values your money enough to keep it secure. Many forex traders have opened forex accounts only for their deposits to disappear overnight. Some forex brokers steal the depositor’s money, others misappropriate it. It may take you a long time to bring these shameless crooks to justice, if you succeed at all. Use a forex broker with a track record of safety and reliability. Ensure the broker is fully regulated by the government agencies of the country in which the broker operates.
While there is a temptation to put your money in the hands of a broker who requires a low initial deposit amount, some of them may not necessarily be the best for a novice trader. Although you should risk small amounts of money at the beginning of your learning curve in forex trading, there is considerable merit in choosing the best forex broker even when the initial deposits they ask is relatively higher than others in the market. You should be guided by the quality of service you are likely to receive rather than the size of the initial deposit the broker requires to get you set up and ready to trade.
Forex brokers make money using spreads. By widening a spread, a broker makes more, regardless of whether you make money or lose money in a particular trade. Consequently, it makes perfect sense to look for a forex broker offering competitive spreads relative to other brokers. For instance, it is a bad idea to work with a forex broker that has a spread over three when dealing with the EUR/USD pair.
Many new forex traders are frustrated after working hard to make money in the trade only to find that they cannot withdraw their money from their accounts from their broker’s trading platforms. Withdrawing your money should be relatively easy to do, with clear instructions on how to do it. Additionally, your broker should allow you to terminate your account if, for whatever reason, you are dissatisfied with their services. Unreasonable delays are unacceptable.
Now and then, forex trading software fails. It is comforting to know that in those moments, there is a number you can call or someone you can speak to that can give you some reassurance as the technical issues are resolved. Additionally, you may experience certain challenges when depositing or withdrawing your money. The forex broker should have its customer service staff ready to help you through these processes and address your concerns.
Take your time to assess each forex broker and the promises they make. Read reviews online and talk to people who’ve worked with them before. This process may take you a while, but it may save you a great deal of pain sometime down the line.