subject: Choose The Right Futures Broker [print this page] Futures market is making its stride forward and commodities are expected to outshine all other investment options. Hence, entering the futures market at this stage shall prove beneficial for you in the long term. With the assistance of a qualified and well experienced futures broker, you stand a good chance to achieve your financial goals.
However, one needs to be wary of the numerous broking firms, who would goad you towards unprofitable, riskier investments to ensure their profits and also charge unreasonable charges. By following these simple steps, you can pick the right futures broker to not only safeguard your money but also to maximize it:
As choosing any service provider, you need to pay attention to the number of years the broker has experience in buying, selling commodities and other financial instruments. Also you should gauge their knowledge and expertise on commodities, financial instruments, market situation and forecasts etc.
To get more information on the broker, you can run a check with the National Futures Association, NFA. It is the governing body of futures brokers in the United States and keeps track of investors' complaints and also stores information about any violations by brokers. You can seek assistance from NFA in choosing legitimate and trustworthy futures broker.
Be wary of brokers charging high brokerage. It is prudent to make comparisons among various brokers and their brokerage charges and choose the one most suitable to your needs. Also, pin your attention to the minimum deposits to be made to open a trading account and any periodic fees to be made. It is crucial to have a thorough understanding of the rates, terms of these payments to avoid unnecessary, excessive payments.
Despite the fact that, you have zeroed in on a well experienced futures broker, it is vital for you to have at least basic understanding of futures market, commodities, strategies etc. It not only helps you to monitor the actions of your broker but also enables you to reach your predetermined goals.
Be cautious of the broker who might drive you riskier investments, higher than your level of risk acceptance. Futures brokers may possibly, with the sole intention of getting instant money from you or to make profits, present you with alluring investment options which are risky. It is prudent to evaluate your risk appetite and not get enticed.
