According to a 2019 triennial report undertaken by the Bank for Foreign Payments, the Forex industry trades $6.6 trillion per day. If that’s not enough, picking a broker from a vast list of brokers that have accrued over the years can make your mind turn. The topic of reliability, protection, and security is still there.
Without a trader, would you exchange overseas currencies? No. Without a broker, all individual traders must sell. This makes finding a firm that you can trust in the Forex sector vital to your trading path.
Not all brokers are in the same mold, though. You would need to select a broker that fits your unique needs as a broker. As not all brokers sell the same facilities or provide the same strategies, like using MT4 and MT5 trading platforms. This is where the challenge resides.
We will address the six broker features that any trader must remember while selecting a Forex broker.
1. The execution
The pace and efficiency of trade execution are some of the factors you would look at. It’s crucial to make your broker complete your order at the best possible price.
For instance, if you purchase EUR/USD for 1,1700, your order should be filled at that price or only within a pipette of it, if there are variations. This is highly relevant if your trading technique of preference is Forex scalping. The fast execution pace is also your tool against slippage that can give your trading resources a large dent.
So make sure to verify how easily a trading site implements your request. To try this functionality, you will need to open a trial or live account, which will eventually be worth the initial investment. You don’t want to risk tiny sums, which will quickly add up with any exchange because of unreliable implementation.
2. Spread and Commission
You have to pay a fee to your broker on any deal, typically in the form of a spread. This applies to the gap in a currency pair between the asking and bid rates of each currency. Usually, the spread is determined by pips.
Various brokers quote various spreads. Several of them can charge a certain percentage of the spread. Also, they do not charge fees but gain money from a more extensive spread, either a constant or variable spread depending on market fluctuations. Fixed or non-fixed commissions can be paid. The former is a flat fee, while the latter relies on a transaction’s type and duration.
3. Trading Platform and Software
The most robust sites for trading are easy to find and use and are consistent and reliable. It must be built with physically appealing graphics fitted with maps, metrics, and other advanced and simple research resources. Most importantly, it has simple and prominently positioned ‘buy’ and ‘sell’ keys, it should make for fast and easy trade entry and exit.
To provide a good description of a site’s capabilities, you can need to launch a demo or live account. This is also one means of knowing the fees and costs of a trader, measuring the network’s implementation pace, and verifying if the displayed price is reached while purchasing or selling.
Many Forex traders, those on MetaTrader 5 or MT5, offer trading on the MetaTrader 4 or MT4 site, while others provide Forex trading on both platforms.
4. Client Support
The broker you chose must have customer service that works simultaneously, as the Forex market is competitive and operates 24 hours a day. You’ll never know when, while trading, you could encounter a snag.
So check out the help methods provided: direct line, Live Chat, knowledge base, email, etc. The more alternatives you have, the more comfortable.
Nothing beats a broker with an entertaining and attentive customer support officer on standby who has a “Live Chat” feature. If customer service is given in many foreign languages, you know that the broker is serious about building a partnership with traders worldwide.
5. Fund Safety
For market merchants, this is another major worry. Nearly everybody poses the following question: “How safe are my funds?”
It is not enough for brokers to only provide segregation in their corporate and customer accounts in this day and era. Some brokers offer an additional layer of protection by hiring a custodian to oversee their customers’ deposit and withdrawal procedures. To secure trading capital, search for brokers that offer these extra layers.
6. Deposit/Withdrawal Procedures
The broker with which you partner should allow you to finance your account and smoothly and quickly withdraw your earnings. We strongly suggest that you make a comparison between individual brokers’ deposit and withdrawal fees and see which ones impose lower fees.