There are practically thousands of registered Forex brokerage firms trying to curve out an edge in the Forex market. As a Forex investor, what do you need to know when choosing a Forex brokerage firm that will serve your needs and make a trustworthy and reliable business partner? Here is a list of vital items to bear in mind as you seek to work with the best Forex brokerage firm available.
- The value of spread offered by the Foreign exchange firm – ‘Spread’ is basically the difference between the value of buying and that of selling a certain pair of currency. If you select a firm that is known to give the best spreads, this will save you money. Most FX broking firms give between 4 and 5 pip spreads when a trader trades in common currency pairs. The best brokerage firm you can settle for should offer between 3 and 5 pips in spreads for common currency pairs.
- The minimum account opening amount – If you are a newbie in Forex trade or don’t have a lot of money to invest yet, it might interest you to settle for a firm that will allow you a small minimum amount to get started with your Forex account. A firm that will allow you $200 minimum account opening balance should be your pick.
- Speed in execution of orders – The speed at which orders are executed is very important in Forex trade. The faster a Foreign exchange brokerage executes orders the better it is to work with. Instant execution of orders means that the price you see and click on is the same that you will get, this should not be compromised.
- Technical analysis and charting features – These tools are very important in Forex trade. You will need to find a Forex brokerage firm that gives you these tools to help you conduct a successful Forex trade free of charge. If your FX broking firm offers no such tools, you would be trading in a very sensitive market blindly. The best Forex tools are even the ones that allow traders to trade on the charts directly.
- Hedging – The FX broking company should have a system that has the capability to trade on same currency on both directions when there are openings without elimination or increase in their margins.
- Demo account – Lastly, settle a firm that has a realistic and fully featured demo account. The realistic part means that the Forex brokerage system should allow a trader to practice with a demo account that suits his abilities and reaches.