Rabu, 30 Maret 2011
Selecting a forex broker
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Foreign exchange market is more than $ 4000000000000 average daily trading value, making it the world's largest financial market. Because there is no central market on the forex market, the entrepreneur must choose a Forex broker to help them operate. There is a large and growing number of Forex brokers and choose the right one requires careful seeing an overwhelming number of magazines and online advertising. In this article we will be five considerations when choosing a broker in today's competitive Forex Forex market.
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| Selecting a forex broker |
1. Regulatory ComplianceIn the United States, a reputable Forex broker member of the National Futures Association (NFA) and is the U.S. Commodity Futures Trading Commission (CFTC) as a Futures Commission Merchant and retail foreign exchange dealers registered. NFA is the industry-wide self-regulatory organization for the futures industry in the United States. Draw up the rules, programs and services to protect the integrity of the market, traders and investors and to help members meet the liability. The CFTC is an independent national authority futures and options markets are regulated in the United States. CFTC's mission is "to protect market users and the public from fraud, manipulation and abusive practices in connection with the sale of goods and financial futures and options, and an open, competitive and financially sound and futures options markets to promote.
Striking and professional website can not guarantee that the broker is a member of the NFA and CFTC regulations. Broker who is a member of the National Futures Association and are subject to CFTC and NFA, the number of membership on their website, it is usually in the "About Us" and on each web page. Any country outside the United States has its own regulatory authority. Because of possible concerns about the safety of deposits and the integrity of the broker, should be used with companies that are properly regulated open.
2. Account DetailsAny Forex broker has changed several offers, including:
Leverage and margin: Forex participants have access to credit are many, depending on the broker, such as 50:1 or 200:1. Leverage is a loan margin account holders through intermediaries. For example, a dealer can use 50:1 with an account size of $ 1,000 to maintain a position which is estimated at $ 50,000. Take advantage of working in positions to win the business for a potential increase in profits strong. Leverage can quickly destroy a merchant account because of the risk of loss is also increased. Use should be used with caution.
Commissions and spreads: the broker earns money through commissions and spreads. Broker commissions that may be used free of charge a certain percentage of the area, the difference between bid and ask price of a pair of Forex. However, many dealers advertise that they charge no commission, and instead of money from the wider spreads. For example, the proliferation of three mesh fixed spread (a pip is the smallest unit of price changes in the Forex market), or the spread will vary depending on market volatility. EUR / USD 1.3943 1.3946 range for the three pip spread. This means that the trader buys time on 1.3946, the situation has only three pips lost value because it can only be sold directly to 1.3943. Wider dissemination of, and then, the harder it is for profit. Popular pairs trading, such as EUR / USD and GBP / USD are usually harder than the more rarely spreads traded pair.
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Selecting a forex broker
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