Currency Trading Broker - What Makes The Best?
Choosing the right currency trading broker is an important part of getting off on the right foot as a trader. You need to consider the fees that your broker will charge as these will affect your profits. There are so many brokers in the market and they differ in the amount they charge. It is not necessary to choose the lowest cost broker, but this is certainly a consideration. It is good to determine if the services you receive justify the costs.
There are some things you need to understand about how fees are determined in currency trading. Some brokers charge a commission but most make their money on the spread between the bid and ask price. The bid is what they would pay to buy your currency, the ask is what they would charge you to buy the currency. An example is the EUR/USD 1.2500/1.2502. The price difference is 2 pips. A pip is 1/100th of one percent on the based on the lot size. On 100,000, the typical size this would equate to $20.00. The smaller the spread the lower your cost will be.
Ask your friends who trade to recommend a broker to you. If they are getting good results from their broker this may be the one you should use. Be cautious with brokers advertising no commissions and low, low fees. This is usually temporary. Look for a broker who is competent and can complete your transactions quickly. Being able to trust your broker is an essential issue to your trading success.
Choosing an honest, ethical currency trading broker is one of the most important things you can do when you are ready to enter the market. You want to use someone you wants you to be a success. It is important that the broker be regulated by a government agency and have a clean record. Beware of scam artists.
It is best to choose a broker that is not going to take the position opposite to your position. This is a conflict of interests. You want to work with someone who is working for you and wants you to succeed. Many brokers have no vested interest in the direction of currency price movements.
If is recommended to choose a broker you trades through the Electronic Communication Network.(ECN) This is the type of currency trading broker who simply matches up trades from the buyers against the sellers. They do not take positions themselves. Market-makers will take the opposite position to yours in order to "make a market." This creates a conflict of interest. Stay away from this style of broker.
A good idea in addition to these recommendations about brokers is to use an online service that affregates information for you make a selection from.
Choose a currency trading broker that works with you as a partner. You want to spend your time making money rather than worrying about who you are trading with. - 23159
There are some things you need to understand about how fees are determined in currency trading. Some brokers charge a commission but most make their money on the spread between the bid and ask price. The bid is what they would pay to buy your currency, the ask is what they would charge you to buy the currency. An example is the EUR/USD 1.2500/1.2502. The price difference is 2 pips. A pip is 1/100th of one percent on the based on the lot size. On 100,000, the typical size this would equate to $20.00. The smaller the spread the lower your cost will be.
Ask your friends who trade to recommend a broker to you. If they are getting good results from their broker this may be the one you should use. Be cautious with brokers advertising no commissions and low, low fees. This is usually temporary. Look for a broker who is competent and can complete your transactions quickly. Being able to trust your broker is an essential issue to your trading success.
Choosing an honest, ethical currency trading broker is one of the most important things you can do when you are ready to enter the market. You want to use someone you wants you to be a success. It is important that the broker be regulated by a government agency and have a clean record. Beware of scam artists.
It is best to choose a broker that is not going to take the position opposite to your position. This is a conflict of interests. You want to work with someone who is working for you and wants you to succeed. Many brokers have no vested interest in the direction of currency price movements.
If is recommended to choose a broker you trades through the Electronic Communication Network.(ECN) This is the type of currency trading broker who simply matches up trades from the buyers against the sellers. They do not take positions themselves. Market-makers will take the opposite position to yours in order to "make a market." This creates a conflict of interest. Stay away from this style of broker.
A good idea in addition to these recommendations about brokers is to use an online service that affregates information for you make a selection from.
Choose a currency trading broker that works with you as a partner. You want to spend your time making money rather than worrying about who you are trading with. - 23159
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A KEY factor for your success will be your currency trading broker if you are serious about online foreign currency trading!
posted by X - Men @ 12:46 AM
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