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The 4 most important factors to consider when choosing a forex broker

The choice of broker can have a major impact on the future success of your trading. According to some experts, the broker is what makes a huge difference in a trader’s success. Some claim that a broker can be the key factor between making 1,000 dollars per trading day or just fifteen dollars. The four criteria are crucial for your trading success, and determining the honesty of the forex broker. Helpful resources!

A broker’s spreads can be a critical factor in choosing them. The spread is defined as the difference between the selling and buying prices of different currencies in a particular time period. Spreads can increase during highly volatile conditions, but it is important to test forex brokers on calmer days. For example, the spread between the Euro and Dollar should be around three “forex units”, or pips. If spreads on major currencies exceed 5 pips in calm market conditions the broker must be told “No”.

Supported currencies can also be a sign of a reliable broker. Many brokers let you trade “the Majors”, the currencies that have the largest trading volume, like the US dollars and Euro. Forex traders tend to prefer trading pairs of exotic currencies like the Israeli Shekel. Make sure your broker allows you to trade any currency pair you desire.

When opening an account for forex trading, many people are concerned about the amount of money they need to deposit. Most brokers have high minimum deposit requirements, some as much as $10,000. Other brokers may require just $25 to start a trading platform. Trading forex is possible with leverage. This allows you to earn large sums with little or no money. Make sure you can still open a forex account with the money you have.

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