Forex trading is one of the most popular online money making channels nowadays. It is very easy to get started as a trader: Everyone just needs to open a trading account at a Forex broker, deposit money, and start trading. With that being said, choosing a brokerage firm could be challenging as there are hundreds of Forex brokers on the market today. So, how can you choose a reliable broker that fits your needs? Read on now to find out!
8 Factors Making a Good Forex Broker
Factor #1: Regulation
Regulation is the leading factor you need to check when learning about a Forex broker. The reason for this is simple: if a broker is not licensed, your rights will not be guaranteed by laws. Worse, without a prestigious supervisor, that broker can do anything with your money and personal information, such as:
- Using your money to invest in other activities
- Selling your personal information to third parties
- Canceling your withdrawal requests
- Manipulating your trading activities
Information about a broker’s regulation can be found right on its homepage. To be more certain, you can check the broker’s regulation claim by searching its registration number on the regulator’s official website.
Reliable Forex brokers often use advanced encryption technologies to protect their clients from hackers. The state-of-the-art one today is Advanced Encryption Standards 256 Bit, which is used by most well-known FX brokerage firms and financial institutions.
To see whether your broker is using encryption technology, check the address bar. If there is a green padlock, you can rest assured that your information is encrypted and secure when you access the broker’s website.
Factor #3: User-friendly Website Design
If someone tells you that “we can’t judge a book by its cover”, tell them that phrase is only relative because it cannot be applied to the Forex broker assessment.
When you visit a Forex broker’s official website, the first and foremost thing that catches your eye is the design, not the content of that website. This impression will often determine whether you should continue with the broker or not.
Of course, we do not expect a florid website design. It just needs to be neat and user-friendly, with information on the broker’s products and services presented obviously.
Brokers that have bad or messy website designs are not the places where you can put your trust in. How can you expect good services in brokers which don’t even take care of their representatives decently?
Factor #4: Good Trading Platform
The trading platform is the backbone of a Forex broker. It directly affects the trading effectiveness of a trader.
Most Forex brokers now offer MetaTrader 4 or MetaTrader 5 – two of the most advanced trading platforms today. However, there are also brokers that provide in-house trading software; in that case, you need to thoroughly check their functions and utilities.
Also, remember to check whether the Forex broker provides trading platforms compatible with mobile devices. If yes, that broker deserves a plus point as this enables you to manage your trading account from anywhere and at any time.
In addition, don’t forget to check the order execution’s speed. The faster the order execution is, the better the broker is. Never trade with a broker where you have to wait more than 2 seconds for the order to be implemented as re-quotes will occur very often.
Factor #5: A Wide Range of Trading Assets
The number of tradable assets is also a factor you need to consider when learning about a Forex broker. More assets and instruments mean more opportunities, and more opportunities often mean more profits.
You should prioritize brokers that provide assets and instruments in a variety of groups (stocks, indices, commodities, currency pairs, crypto assets, etc.) because that will enable you to diversify your portfolio.
Factor #6: Reasonable Minimum Deposit and Withdrawal
Minimum deposit and withdrawal are also things that you should deliberate. Prioritize brokers which offer low minimum deposit and withdrawal as that will allow you to be flexible with your investment.
The average minimum deposit in the Forex industry is currently $250, while the average minimum withdrawal is $100. Some FX brokers even allow traders to start with just $10.
Factor #7: Transparent Terms and Conditions
There is one thing that many traders often overlook when they learn about a Forex broker: Terms and Conditions. In many cases, this leads to unfortunate incidents such as being unable to withdraw their money or to complete verification procedures.
Don’t make this mistake.
Before successfully opening an account with a broker, you will be asked to confirm your agreement with the broker’s terms and conditions. Take about 15 minutes to read these terms carefully, and if you discover anything vague, don’t hesitate to clarify it with the broker’s specialists.
Factor #8: Professional and Dedicated Support Team
The support team often contributes a huge part to a Forex broker’s success. Without them, traders will face many difficulties in accessing information about the broker’s products and services as well as on their trading journeys.
Therefore, assessing a broker’s support team is highly necessary. The top 3 factors that make up a good support team include professionalism, promptitude, and enthusiasm. Nobody wants to talk to specialists who are rude, slow, and irresponsive.
Besides, you need to check the contacting channels that a Forex broker provides. There should be direct and fast channels such as Phone or Live Chat; that will allow you to reach out to the broker’s specialists in urgent cases.
The Bottom Line
So, you have just gone through 8 factors that make a good Forex broker. Please note that the importance of these factors is nearly the same so you should not ignore any of them when evaluating a broker.
If you find it difficult to conduct an assessment, we can introduce to you a trusted broker: FinmaxFX. This is one of the brokers that have all of the good factors mentioned above.
- Licensed by the International Financial Market Relations Regulation Center (iFMRRC) – a reliable regulator specializing in the Forex industry.
- Website encrypted by the Advanced Encryption Standards 256 Bit technology
- Neat and user-friendly website design
- Offers MetaTrader 5 trading platform usable on PCs, mobile devices, and browsers
- 421 assets and instruments available for trading
- $250 minimum deposit – $25 minimum withdrawal
- Transparent terms and conditions
- Multilingual support team available 24/7/365
Besides, this broker offers many generous and useful promotions plus a comprehensive education center to help traders improve their knowledge and trading skills. They also provide personal training and webinars.