How to choose a reliable Forex broker?
Forex is a worldwide market that operates 24 hours a day and turns trillions per day. It is also a market where thousands of investors exchange currencies, hoping that these operations will bring them a profit.
But to carry out these transactions, they need to go through an intermediary. This intermediary is the forex brokerage service. Look at this thefinancialig.com review to see what a brokerage can eventually offer.
You must therefore be sure of the quality of your intermediary before starting. This is not always the case: for example, some brokers prefer to display a Ferrari on their home screen than basic information on the strength of their site and the guarantees they have taken out … rates, bonuses and dreams that some sometimes put forward, here are the four points to check to select the right broker.
Is your brokerage regulated?
Before transferring your money to the trading account you have opened, you have to be sure that it will not vanish in nature. Therefore, the first precaution is to check that the broker is subject to European legislation. To do this, you will ought to check whether it operates in compliance with the law in one or more countries of the European Union or whether it operates off-shore.
Normally, your broker does not really collect the money you deposit into your account. In fact, it is deposited with a third party establishment, a bank, generally, which is responsible for guaranteeing its availability. A licensed broker also takes advantage of the bank guarantee fund. It also assures that you, in case of bankruptcy, will remain the owner of your capital and that you can dispose of them at any time.
The trading account
The first element to check is the quality of the platform: is it practical and complete? Is it slow? Has your demo account crashed? Then you have to look closer at the fees and commissions. The majority of brokers offer an immediate opening of the trading account, followed by a first deposit through transfers or more or less known payment methods. You should immediately inquire about the conditions for withdrawing funds: in some cases, these withdrawals are accompanied by high fees or unbearable delays. In addition, the use of the trading account may be subject to special commissions.
Hence the necessity to review all the costs associated with your Forex activity. Financing costs, leverage, rollover costs, level of spread without forgetting the fixed commissions, such as withdrawal costs, closing costs and even sometimes the costs of ‘inactivity because you should know that some broker companies “punish” their clients when they notice the absence of transactions within 30-60 days.
Also, pay attention to the trade conditions between a demo account and a real account. Some brokers thus offer very interesting trading conditions on their demo account but apply a completely different policy to their real accounts.
Finding a reliable broker is not easy, but also, if you follow our guidelines shouldn’t represent a nightmare. We wish you good luck in finding the one that matches your specific needs.