Finding the best currency brokers

Deciding between Market Makers and Electronic Communication Network brokers is only half of the mission one takes on, when trading on Forex. The question is how to find the best currency brokers and which are the things that must be taken into account to be certain you made the right decision.

Safety comes first or at least it should be, so when you think you’ve found a currency broker that meets your expectations, make sure he is registered as a Futures Commission Merchant by the commodities trading Commission. This is the best way to prevent any aggressive trading practices and other type of scams performed by unscrupulous forex currency brokers.

If a friend recommended you to check out Forex, than don’t forget to ask him about the foreign currency broker he works with because testimonials are the best way to get inside knowledge. A close friend is better to ask for advice, because you can be sure he’s trying to help, so you won’t risk making the wrong choice based solely on reviews. Reading and researching is only going to help though, as money is not the only resource that needs to be invested in Forex, but time as well.

Since the markets are very dynamic you will need a currency broker that is available most of the time, so depending on the time he needs to reply to your questions is a good hint. In most cases they are faster to respond to any inquiries before you make an account than after, but it is still important to test them this way. Speed is also of the essence when we talk about processing a trade, but pay attention on how much slippage you’ll experience during standard and rapid moving markets. Information is power and you’ll only have to gain from a foreign currency broker who can provide you with additional data about slippage.

The best currency brokers will offer competitive spreads, which is very important because you have to know exactly how high will the costs be. You should be aiming for tight spreads of only 3-4 pips to maximize you earnings, but least costly brokers are not necessarily the best, and price alone shouldn’t be a deal breaker.

Having the best software, or at least one that is user friendly and easy to understand is going to help a lot. The best currency brokers will offer a competitive software and free practice accounts, and you should try more than a few before deciding for the one which raises to your standards.