Investment decisions require knowledge and analytical thinking. In order to choose the best forex broker is not an easy decision and it requires time and patience. Searching for a broker with a high level of investment security and reliable trading conditions takes advanced experience in the financial markets. Eventually, trading with the wrong forex broker can be costly for forex traders and especially beginners.
While the top forex brokers will offer low spreads, robust resources, and direct access to the worldwide interbank system, there are still other factors to investigate. Therefore, it is important first to explore the trading world and understand the role of forex brokerage and how to open a trading account?
The Forex broker is an intermediary entity between retail traders and the forex market or the interbank system, in which major banks trade with each other. The broker provides financial services to facilitate the process of buying and selling foreign currencies for retail traders. Clients of a forex broker may also include large financial institutions that trade on behalf of retail customers and investment banks.
What is The Role of the Forex Broker?
The foreign exchange market has a high volume of liquidity and trading volumes. Most foreign exchange transactions include the G10 currencies. Many Brokers offer trading for more currency pairs, including those of emerging markets.
Forex most traded Currencies are (1) the U.S. dollar -USD, (2) the Euro -EUR, (3) the Sterling Pound – GBP, (4) the Japanese Yen -JPY, (5) the Australian dollar – AUD, (6) the New Zealand dollar – NZD, (7) the Canadian dollar-CAD, and (8) the Swiss franc -CHF.
The forex broker offers its clients currency pricings from liquidity providers like major banks. Sometimes a forex broker uses multiple banks for pricing and offers you the best one available.
How to open a Forex Account with a Forex Broker?
Forex account is used to trade foreign currencies. Typically, you open forex account, deposit money and then buy and sell currency pairs. Opening a forex trading account is a quite simple process these days given the growth of online Forex trading. It requires some paperwork and a few security steps, such as identity verification, and all can be done online. But first, you’ll have to choose the best forex broker, select an account type, register then activate your account.
10 Tips For Choosing The Best Forex Broker
1. Check the Regulatory Compliance
The first step will be checking the broker’s regulatory compliance. Make sure to choose a regulated forex broker, which keeps you safe from scams and frauds. The safety of your money and personal information is highly important when you open a forex account because brokers can get hacked or go bankrupt.
2. Diversity of Account Types
It is important that the forex broker offers a wide range of trading accounts that suits different experience levels and trading capitals. You’ll have to spend some time checking the list of available accounts that your broker offers, and decide if any matches your experience and designated investment capital.
3. Review Features and Advantages of the Trading Accounts
Take a deep look at account features and advantages offered by the broker. Each forex broker has different account features. Four aspects to consider when comparing account features among brokers are commissions and spread, ease of deposits and withdrawal, leverage and margin, and initial deposit requirements.
Commission: also known as the compensation for trading intermediaries in non-spot forex, it is less popular in the retail Forex industry. Zero-spread and ECN accounts usually have some sort of commission.
Spread: the difference between the bid and ask price, it’s usually how brokers make profits if they charge no commission. Make sure you have a look at the spread charged for each account. The most reliable forex broker should always provide the lowest spread on major currency pairs.
Deposits and Withdrawal: The flexibility of the deposit and withdrawal from your account is a critical factor in choosing your forex broker. The best forex broker should provide reliable options for both deposits and withdrawals.
4. The Reliable Leverage
Leverage is an investment tool of using borrowed capital to maximize an investment’s potential return. Funds that brokers lend its traders in order to multiply their investment capacity and increase the rate of potential return.
The top forex brokers out there offer a wide variety of leverage levels, so make your research and choose the suitable leverage for your trading goals. Remember, leveraged forex trading is a double-edged sword. So, it is important that forex traders know how to manage leverage usage and adopt a strict risk management plan to mitigate potential losses.
Features of Forex Accounts from AximTrade: 1. Variety of account types including Standard, Cent, ECN, and Islamic 2. Competitive Leverage Levels up to infinite leverage 3. Tight spreads and low minimum balances reduce financial commitment 4. Fast order execution with execution speed at 0.004s 5. Minimum deposit of $1 and no commission 6. Instant deposit and withdrawal, wide variety of payment methods 7. Excellent customer service reachable through email, live chat, and more
5. Currency Pairs and Trading Instruments Offered
Another feature to keep in mind is the currency pairs offered. Some brokers offer only limited pair choices, which will cap your trading activity. So, you need to check what pairs the broker offers for trading before getting started.
Besides, it is crucial to check the diversity of trading instruments available on the broker’s platform like commodities, indices, and cryptocurrencies. This will help you diversify your portfolio and offer more trading opportunities for you.
6. The Trading Platfrom
The trading platform is your portal and a vital trading tool. So, you need to make sure a broker’s platform and software provide the essential trading tools you need, and that trades can be executed smoothly. This one can easily be checked by opening a demo account. It is a trial account, with no deposit required, that will help you discover the broker’s platform and services before opening your real account.
Metatrader 4 is of the most popular forex trading platforms. It is well known for its very user-friendly interface, which enables new and experienced traders to trade with ease and comfort. Traders of all levels find this Forex platform easy to use.
7. Execution Speed
Make sure to choose a forex broker who executes your orders at the market price you chose to open or close your trade at. Ensure that the forex broker offers fast enough execution to facilitate easy quick order execution. The best forex broker is the broker that takes advantage of technology to provide the fastest execution speed.
With AximTrade, enjoy real-time market execution with no re-quotes and no rejection of orders policy. Forex Traders can execute different market orders with 0.004-second execution speed.
8. Reliable Customer Support
Having reliable customer support is also another huge feature to consider while choosing your broker. The forex market is operating 24 hours a day, so a broker’s customer support should be available at any time to answer your questions and offer help whenever needed. You can contact the broker to get a better idea of their customer support tools and average wait times.
9. Educational Resources
It is really important if your broker offers some forex education resources to ensure that you are trading profitably. A good forex broker will provide clients with educational content as well as favorable trading conditions. Consider trading with a broker who offers you training videos, articles, courses, and other relevant materials at no extra costs.
10. Bonus and Promotions
Forex Bonus is a promotional offer usually as a fixed amount of money or a certain percentage gifted to traders as they open an account, deposit money, or open a defined number of trades, depending on the bonus type. Forex bonus has many advantages including increasing trading equity and investment capital and examining how good a broker is. However, you have to pay close attention to the terms and conditions of every bonus package.
You’ll need to do some research, information gathering, and then compare forex bonuses offered by brokers. One of the very common mistakes some traders make when choosing a forex broker is that they build their entire choice only on the bonus size. In this case, traders may end up choosing a forex broker with wide spreads or high commissions per trade. This means that the forex bonus you earned will be charged as trading costs eventually.
The Forex Broker is considered your trading partner. Brokers tend to offer a wide range of trading tools to facilitate trading for their customers. Choose the best forex broker wisely and keep a checklist of what we have mentioned earlier before choosing what suits you better. Read the full AximTrade review for more insights about forex trading with a reliable broker.
Join the Market and Start Trading Now
Explore the best trading conditions with AximTrade, a global leading broker with infinite leverage, one of the top competitive leverage conditions which allow traders to have high flexibility with margin requirements and maximize the number of positions. Check why traders choose AximTrade.
AximTrade is a fast-growing brokerage service provider in the global markets with a highly advanced MT4 execution and Copy Trade platform. One of the core values of AximTrade is to enable forex traders with easy-to-use technology, educational resources, technical analysis, varieties of forex bonus promotions, and a highly competitive trading environment with the best trading conditions.