5 Tips to Find the Best Forex Company
The forex market records an average daily trade volume of more than 4 trillion dollars and this is why it is the largest financial market in the globe. Because there is no centralized platform for trading the forex market, the forex trader must be registered with a forex broker to participate in the forex market. The huge number of forex brokers in the market makes selecting the best forex company difficult for an average trader. To make the task easier, we have provided in this article the top five tips you need to follow to ensure you work with a credible forex company. Let’s see what they are:
1. Registration with a regulatory body
The first condition of working with the best forex company is ensuring that the company is registered with a credible regulatory body and complies with the rules of the said regulation. These regulatory bodies protect forex traders and investors from fraud, manipulation and abusive practices that could occur in the trade and investment market and to ensure open, competitive and financially-sound market.
Top regulatory bodies around the world
United States: NFA and CFTC
United Kingdom: FCA and PRA
interphase with clear ‘buy' and ‘sell' buttons.
A few trading platforms from best forex companies come with additional perks like a "panic" button which closes all open positions. Ensure that the platform provides all trading information in a precise manner.
A few more considerations are customization options, types of order entries, automated trading solutions, strategy generators, backtesting capacity, and trading alerts. Many forex brokers equally offer free demo accounts to allow traders to try out the trading platform before opening and funding their accounts.
3. Account Details
The offerings of a trading platform differ from broker to broker and this can include the following:
Leverage and Margin
The leverage offered by brokers varies and can range from 50:1 to 200:1. Leverage and Margin account allows traders to borrow money from their broker to trade. While it can increase your winning potential, it has the potential to entirely wipe your account within seconds if the trade does against you.
Commissions and Spreads
Forex brokers commonly make their money from commissions and spreads. Forex companies that charges commission may demand a specific percentage of the spread, the difference between the bid and ask price of the forex pair. Nonetheless, many brokers don’t charge commissions but make their money through wider spreads.
The minimum account opening amount equally varies from broker to broker. Most forex brokers allow traders to open an account with as little as 50 USD. Such traders, however, utilize leverage to increase their buying power which can work either way-profit boost or escalated loss.
Ease of Deposits and Withdrawals
Check the account funding and withdrawal policies of your broker. Some forex companies allow users to fund accounts online using credit cards, ACH payment, PayPal, or through a wire transfer. Some equally accept bank check, business or personal check. Withdrawals are frequently carried out through check or by wire transfer. There are usually associated with withdrawal fees. Check that your broker doesn’t have policies that limit your withdrawal ability.
4. Available Currency Pairs
The forex market is traded in currency pairs. There is a plethora of options that the trader can trade. The major currency pairs, however, include the following: (USD/JPY), (EUR/USD), (USD/CHF) and (GBP/USD). The forex company may offer a large collection of currency pairs but the most important thing is for you to ensure they offer the pair(s) you want to trade.
5. Customer Service
Forex trading occurs round the clock. So, you must work with a broker that provides round-the-clock customer service. Also, check that you can easily get a live person to speak with if you have a problem instead of just the auto bot response. You can easily get an idea about a broker’s customer service by giving them a quick call. Check their waiting time and the ability of the customer service personnel to offer you some useful help.
While you can make money trading the forex market, there are a few factors you must get right to increases your odds for success. One of the most essential factors in working with the best forex company. We have provided you with tips for finding the best forex company you can trust.