Navigation

Why You Need a Forex Broker

Getting into forex trading is easier now that it was before. The Internet has revolutionized the forex trading industry, allowing small individual investors to get into the picture.

Although the forex market is now open to anyone and forex trading is ideal part-time job, novice forex traders still need the assistance of experts. These experts are forex brokers, and they can advise you on the right decisions to make in forex trading.

Forex brokers act as the "bridge" or link between the trader or investor and the market. You can think of them as middlemen, but unlike middlemen, they help their clients succeed in forex trading by providing expert, professional advice and accurate, reliable information.

A forex broker can be an individual person or a group of persons. They can be found in a real office or on the Internet. There are many online brokerage firms offering 24-hour, round-the-clock access so that you get the information and expertise you need anytime you want. This characteristic is great for forex traders who work in different time zones or who prefer to trade in unconventional working hours.

A forex broker must offer low pip spread on major currencies. Ideally, your forex broker should offer 2 pips spread for the USD/JPY and the EUR/USD. The pip spread for the other currency pairs should be 3 pips. This ensures that trading costs remain low for a higher return of investment.

The forex broker should provide instant execution on all orders and no slippages and requotes. Furthermore, the forex broker should provide a trading platform that is stable, secure and reliable. The trading software should be free from bugs and crashes, with constant data backups to secure your information in cases of server crashes and power failures.

Aside from providing a reliable trading environment, your forex broker should also give you access to valuable market information, such as forex trading signals, indicators, trends, market news and real-time charts. Your forex broker must also be capable of providing free technical analysis packages and a fully-functional and executable streaming prices feeds.

To protect you from losses, your forex broker should guarantee you of no negative balances and limited risk features. This means that your forex broker places stop-loss orders to prevent you from losing all your money in case of a failed trade.

Now you already know the characteristics and features of a good forex broker, you should also know where to find one. Many Internet forex directories provides reviews, comparisons and ratings of forex brokers to help you decide which is the best one.

Once you have pinpointed a particular forex broker, you can ask for their track records and past performance to know if their services really work for you. You also have to ensure that the forex broker is a member of the National Futures Association and regulated by the Commodity Futures Trading Commission or the proper authorities in your country.

Finding a good forex broker is not difficult as long as you know what to look for. So if you want to become a successful forex trader, hire a capable and experienced forex broker and avail of their expert advice and services.