When you’re going to place your hard earned money in somebody’s hands, you need to be very selective. The first thing that you must make sure is how good their services are; secondly, you must ensure that they do their business honestly. These two factors are also applied in selecting the best forex broker. In this case, you have to make a forex broker comparison, so make sure you already have the candidates on your mind.
Check out these details in your fx broker candidates and see who provides the best services:
Check out their leverage
Bigger leverage means bigger chance to make more profits, but it also indicates higher risk when your analysis goes wrong. Leverage is certainly a crucial aspect, but don’t decide on a broker given that they offer bigger leverage compared to the others.
Many people feel 1:200 leverage is adequate. Several forex brokers even offer up to 1:400. Well, it’s your call. Just be sure to do a basic calculation before you take a position and put your stop loss appropriately to avert being wasted by the market movement.
See their spreads
For long term trader who aims for huge profits, another 1-2 pips in spread is not your biggest concern, but for day trader or scalper, tiny spread can really make their life easier. Based upon their spreads, forex brokers can be broken down in 2 groups:
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Fixed spread; this kind of broker uses fixed spread and get profits from that.
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Floating spread; this sort of forex broker give you real spread (which constantly changing) and ask for commissions for every single trade.
Floating spread might looks lower, but it isn’t always more rewarding. Get a practice account and test them out yourself. How often do you get spread below the standard fixed spread? Does the floating spread worth the commissions?
Test their trading platform
Trading platform is a solid reason to decide on a broker and ditch the other. Some trading platforms are definitely more reliable and more advanced than the others.In this case, you should put in priority on forex brokers that provide such trading platforms.
It’s impossible to find out until you try them, so I suggest you open a demo account and test a lot of them. I would recommend the popular MT(MetaTrader) as my primary choice, but some broker’s trading platforms are also very convenience to use.
Minimal deposit
While I don’t believe that $50 will get you anywhere in currency trading, a number of people may have different opinions. They may think it is great for practice or training purpose where you have got actual money at risk. That way, you can learn a little about trading psychology and remain calm when the market goes on the wrong way. Of course, you probably won’t be as calm if it was $10,000 at risk, but it’s a good start anyway.
Of course, there are other considerations when you comparing some forex brokers; however, you should prioritize these four. The goal here is having a broker that can provide your all trading needs. That way, it’ll be easier to trade and making profits. One more important thing: don’t forget to check their credibility; you don’t want to place your money in the hand of someone who will scam you.