A question many of my friends ask me when it comes to forex online trading is the following: "What are the best forex brokers available online?" It is a fairly good question I must say. I do not really have an absolute answer. However, what I can tell them is what the top forex brokers should offer. The rest is up to them: A good forex broker always needs to suit your investor profile and your general trading strategy.
Now, there are quite a few points to take in consideration before you decide whether or not you want to use a specific broker. The best forex brokers, however, always offer these advantages: Low spreads, high leverage and small minimum deposit.
Here is the reality about spreads; if the spreads are too high, your gains will be cut and your losses will be more important. The reason is simple: You have to buy higher than the price at which you can sell, so if the difference is too big, remember that you will have to pay this spread on each and every one on your trades, therefore reducing your gains. Hopefully, spreads are usually the only fees charged by brokers. Make sure they are as limited as possible.
Leverage is a very well-known characteristic of the forex market. It allows you to take a position that is larger than what you could normally afford. As long as you keep the margin required in your account, you are allowed to get the borrowing required to finance your positions. This allows you to multiply your gains, but your losses as well. If you use a 500:1 leverage, your profits are multiplied by 500 (on the base of your real money investment). Remember it works the other way as well, so it makes leverage a pretty risky tool. Nevertheless, I'm sure if you are willing to trade the forex, you are there for the money and you know the risks you're taking, so high leverage is an interesting feature.
If you don't have that much money at the start, you also need to worry about the initial deposit that is required. The best forex brokers allow smaller investors to trade on the forex market. If you don't care about this point because you have a lot of money to play with, you still want to look at privileges some brokers give if your initial account is high enough. This could include lower spreads and increased leverage allowed.
There are other features top forex brokers might offer you to get you subscribed. They might offer you a free starting bonus, but keep in mind it's just a bribe so you join them. Most of the best forex brokers also have a free demo that you can try. I highly recommend trading for a long time on the demo with fake money before you start trading for real. This will allow you to get yourself familiar with the platform and to greatly improve your trading strategy. It will also help you to see if a specific broker fits to your needs or not. Good luck with your forex trading!
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