Choosing the right forex broker is a rollercoaster adventure for every new trader. To make the process less traumatic, it is necessary to check for the certain features which separate reputable broker from a trouble-maker.
Is Your Broker Worth Trading With?
In most cases, regulated broker is your best shot. Regulation authorities are NFA (National Futures Association), CFTA (Commodity Futures Trading Association), SAEC (Securities and Exchange Commission) and others. Regulated broker has no reason to hide it and therefore you will be able to find the regulated authority on the front page of the broker's website. In case you cannot find it anywhere on the site - most likely the broker is not regulated.
Flexible lot size gives a trader a chance to try out all of kind of strategies. Not all brokers are generous, but those who offer mini accounts along with standard accounts are a good pick.
Why mini accounts are useful? Mini accounts are great for beginners who switch from demo trading to the real thing. While you trade with the lowest chances of loosing lots of money, you have an opportunity to test your strategies on the real market. Later on you can always move on and upgrade to the standard account and trade larger sums.
With most brokers, you will be presented with several leverage options starting from 1:50 and up to 1:500. Keep in mind that very high leverage is not advisable, because despite the ability to earn big, there is also a higher risk of falling all the way down to nothing.
A good broker shouldn't offer spreads that swing higher than 5 pips on the majors. Stay away from the brokers that offer 10 pips and higher.
Customer support is crucial for every trader - whether for technical or trading issues. Not only the presence of support, but also the efficiency and the quality are important. Try contacting the broker via all the listed support options - online chat, phone, email etc.
Forex broker should offer a professional trading platform along with technical analysis tools, real-time charts, data feeds and news. Also, let's not forget the free demo account for practicing - brokers that do not offer a simulator is most likely a total scam.