Three Things to Consider when You’re Choosing a Forex Broker
The foreign exchange market is the largest financial market in the world, trading around $4 trillion every day. Unlike other markets, there is no central marketplace, which means that traders must conduct all of their activity through a broker like OANDA
The fundamental importance of this enterprise to your trading strategy means that it ’s very important to choose the right outfit for you. This can be time-consuming, and the sheer number of brokers available to choose from overwhelms many people. However, by bearing these three simple considerations in mind, you can find the perfect brokerage firm for you.
In the world of forex, there are a few golden rules, chief amongst them this: choose your broker based on your currency pairs, not your currency pairs based on your broker. The currency combinations you choose ought to be specially selected to complement your trading style, strategy and attitude to risk. A simple self-assessment will lead many people to choose the four majors on this basis, as they tend to be well suited to the majority of traders. Their popularity means that almost every broker will offer them, which makes the task of finding a firm relatively simple. However, some traders will be drawn to a combination that’s a little more exotic. Although brokers who cater to your needs will be harder to find, don’t be tempted to change your decision: the perfect broker is out there for you too, so long as you’re prepared to look for them.
Customer service is another key consideration to bear in mind when choosing a broker. The forex market operates 24 hours a day, and this means that you need constant access to it. As the only way to gain access is through your broker, they need to be on call at all hours of the day and night, to provide you with support and answer any queries that you might have.
Equally, you don’t want a firm that will send you through an answering machine or automated service before giving you the opportunity to talk to a professional. The forex market often requires mile-a-minute decisions, and that means that you need to be able to get in touch with someone who can advise you as and when you call, as opposed to sitting around and waiting for a call back, or losing a trading window whilst you’re busy pushing buttons on your telephone.
The easiest way to find out which brokers offer this level of customer service is during your initial inquiries. Be sure to call out of ordinary business hours, and see how long it takes you to be put through to an actual person. If the answer is more than a minute, then walk away.
The third, and perhaps most important, consideration is the platforms that different brokers offer. The trading platform you sign up for will act as your conduit to the marketplace, so it has to be utterly perfect for you. When you’re assessing suitability, make a written checklist and compare each platform you try against it, rating them in terms of ease of use, aesthetics, tools, and data. If there is a single area that you’re unhappy with, then look to someone else to meet your needs.
Follow our top tips today and you’ll find the perfect broker for you.