subject: Searching For A Forex Broker? 5 Pointers To Help You Out [print this page] Getting started in online forex trading is both rewarding and challenging. Nearly every seasoned trader recommends that you start off trading by hiring a broker, as they will become your main connection to the market and will make all of the trades for you, as well as provide you with real time price data. You can expect to be charged a set fee - either a commission on each trade or a fee based on the use of a spread. Considering the fact that there are hundreds of forex traders out there today, it can be very difficult to know how to find a trustworthy, inexpensive and reliable person to work with.
Below are five tips to help you find a good forex broker:
Consider the System Used
It is very important that your forex broker uses a system that is reliable. You should inquire about how often the system experiences 'down time' and whether or not the backup system takes over immediately, as there is nothing more frustrating than having the system crash while you are involved in trading. It is also a good idea to check the speed of the broker's website at different hours throughout the trading day to be sure that it loads quickly.
Pricing
The costs should be one of the main factors when choosing a broker. The commission rates charged by brokers can run anywhere from $10 to over $40 and usually the price charged is an indication of the overall service you will receive. Sometimes the rates only cover the standard trades and you will end up having to pay more for options, limit orders and so forth.
Start-up Cost
The start-up cost is the amount of money you will have to put down in order to begin trading forex. This fee can range from a few hundred dollars up to thousands. If you want to take part in shorting or margin trading, you will be required to put down more money. While novice investors are advised to avoid short sales, you may want to partake in it in the future, so check to see if this is an option.
Support/Customer Service
If you should have a question, you will want easy access to a live human being. There is nothing quite as frustrating as sitting on the phone, being forced to push button after button, waiting to get a hold of your broker. Conduct a couple of test runs with the broker's service department by making a call to see how long it takes before you are allowed to speak to someone. Send an email to test their response time. Keep in mind the fact that the less expensive brokers do not offer as much when it comes to customer service.
Experience
It is always a good idea to look for a forex broker who has been in business for a few years. You should always do a bit of online research on the broker's name to see what type of press they have received be it good or bad. You want to use a broker that is known to be reliable. Online forex trading forums are a good source of information as often times you will see the same few broker's names being mentioned, which is a good indication that those particular brokers are good.
Without a reliable broker, even the best forex trades have a limited chance of success. Take these tips into consideration so that you will choose a broker who is reliable, skilled and working with your best interest in mind. A good broker will not want you to lose your money, even though they are making a profit regardless if you win or lose.
