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FOREX Brokers
Most FOREX traders use a broker to handle their transactions. What exactly is a broker? Strictly speaking, a broker is an individual or a company that buys and sells orders according the investor's decisions. Brokers earn money by charging a commission or a fee for their services.
A FOREX broker needs to be associated with a large financial institution such as a bank in order to provide the funds necessary for margin trading. In the United States a broker should be registered as a Futures Commission Merchant (FCM) with the Commodity Futures Trading Commission (CFTC) as protection against fraud and abusive trade practices.
Before trading FOREX you need to set up an account with a FOREX broker. You may feel overwhelmed by the number of brokers who offer their services online. Deciding on a broker requires a little bit of research on your part, but the time spent will give you insight into the services that are available and fees charged by various brokers.
The best advertising is word-of-mouth advertising, and this is just as valid in FOREX trading as it is for any other type of business. Talk to friends and associates to see who they are dealing with and find if they have any complaints or difficulties in dealing with a particular broker.
You could try selecting a few online brokers and contact their Internet help desks to see how quickly they respond to enquiries and whether or not they answer questions to your satisfaction. Keep in mind, however, that pre-sales service may be better than after sales service. This can be true for any online business, not just FOREX brokers.
Customer satisfaction and safety are just part of the story. You want to find a broker who executes orders quickly and with minimum slippage. All online brokers should offer automatic execution and have clear policies regarding slippage. They should be able to tell you how much slippage can be expected in both normal and fast-moving markets.
Next you want to know the fees involved. What is the spread? Is spread fixed or variable according to the type of account? Are mini accounts subject to wider spreads? Are there any other charges? Smaller spreads mean more profit for the trader, but there may be a trade-off between spread and service. Look at the overall picture before deciding to go with a particular broker.
Margin accounts are the lifeblood of FOREX trading, so be sure you understand the broker's margin terms before setting up an account. You need to know the margin requirements and how margin is calculated. Does margin change according to the currency traded? Is it the same every day of the week? Some brokers may offer different margins for mini and standard accounts.
Trading software is very important for the online FOREX trader. Get a feel for the options that are available by trying out a demo account at a few online brokers. Above all, you are looking for reliability and the ability to perform well in fast-moving markets. The software should offer automatic trading and may have special features such as trailing stops and trading from the chart. Some features may only be available at an extra cost, so be sure you understand what your trading needs are and how much the broker charges to provide them.
Other information to find out about includes the broker's policy regarding minimum account balances, interest payments on account balances, which currencies can be traded and whether or not non-standard sized lots can be traded. You should also find out whether clients' funds are insured and the extent of that insurance.
Forex Trading News
How Traders Boost Forex Trading Vocabulary with Vantage FX UK - Mon, 06 Feb 2012 01:00:00 -0800
LONDON, February 6, 2012 /PRNewswire/ --Vantage FX UK is helping traders to tell their adjustable pegs from their leading indicators with a comprehensive Forex trading glossary hosted on its website, http://www.vantagefx.co.uk/ ... A Beginners Guide to Forex Trading and the US Dollar - Tue, 31 Jan 2012 07:43:00 -0800
SADDLE RIVER, New Jersey, January 31, 2012 /PRNewswire/ --Forex or FX for short, foreign exchange trading is one of the most widely traded markets in the world while all the major currencies trade against ... Best Forex Trading Platforms Announces New Website Launch - Sun, 05 Feb 2012 00:20:00 -0800
Best Forex Trading Platforms has recently announced the launch of their new website ranking and reviewing the best online forex platforms. They have made it their goal to bring top of the line platforms to trader all around the world. (PRWeb February 05, 2012) Read the full story at http://www.prweb.com/releases/2012/2/prweb9167589.htm EUR/USD Forex Forecast Weekly Review 5 Feb 12 - Sun, 05 Feb 2012 08:31:43 -0800
Simultaneous Release at TheGeekKnows.com Learn Forex Trading and read exclusive EUR/USD Reviews. Good day forex traders. In the previous EUR/USD forex forecast review we noted that the SMAs were turning bullish. In fact the short term SMA 20 had already began to slope up. The immediate concern of the Euro Zone budget deficit crisis probably remained to be Greece [. Leading Australian Forex Trading Broker IC Markets Ends a Record 2011 Year - Sun, 29 Jan 2012 06:02:11 -0800
International Capital Markets Pty Ltd (IC Markets) a market leading Australian forex broker today announced its 2011 results culminating an exciting year for the company. Over the 2011 year forex trading volumes increased by 83%, with the number of clients increasing by a record 93% representing two straight years of double digit growth.SYDNEY, AUSTRALIA (PRWEB) January 30, 2012 International ...
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RELATED ARTICLES
Calculating FOREX Profits and Losses
FOREX currencies are traded in much smaller divisions than cash. Whereas the smallest division in US cash is the penny ($0.01), US currency can be traded on the FOREX in divisions of $0.0001. This smallest division is called the pip (short for Price Interest Point - sometimes just called 'points'). Since currencies are traded in large lots of (say) $100,000 - small movements in value can generate substantial profits and losses. In a lot of US$100,000 one pip is worth $10 so an increase in 40 pips (4/10 of one cent) can generate a profit or loss of $400.
FOREX Brokers
Most FOREX traders use a broker to handle their transactions. What exactly is a broker? Strictly speaking, a broker is an individual or a company that buys and sells orders according the investor's decisions. Brokers earn money by charging a commission or a fee for their services.
FOREX Signals
One of the disadvantages of FOREX trading is the time investment needed to monitor the markets for advantageous entry and exit points. It's possible to sit in front of a computer monitor for hours watching the markets.
FOREX Trading Strategies
To be a successful FOREX trader you need a trading strategy. There is no one set strategy that is good for all traders; rather, each trader needs to develop his or her individual approach to the FOREX. Some traders rely solely on technical analysis while others prefer fundamental analysis, but many successful FOREX traders use a combination of both to get a broad overview of the market and for plotting entry and exit points.
FOREX Training
Knowledge is the key to successful FOREX trading. The knowledgeable trader has greater awareness of how the market moves and more chances of making profitable transactions. Without knowledge you are shooting in the dark. You may succeed on a few deals but the odds are that you are going to lose in the long run.
FOREX versus Stocks
Stocks have been a popular investment for hundreds of years. Companies issue stocks to raise capital for expansion and new projects, and each share of the stock represents a partial ownership in the company.
How to Read FOREX Quotes
Currency prices are determined by a number of factors, the most important of which are economic and political conditions in the issuing country. Political stability, inflation, and interest rates are all factored into the price of any currency. In addition, governments can try to control the price of their currency by either flooding the market (to lower the price) or buying extensively (to raise the price).
Introduction to Fundamental Analysis
FOREX traders almost always rely on analysis to make plan their trading strategies. There are two basic types of FOREX analysis - technical and fundamental. This article will look at fundamental analysis and how it used in FOREX trading.
Risks of FOREX Trading
Despite the claims you may see on some FOREX web sites, FOREX is not risk-free. You are trading with substantial sums of money and there is always a possibility that trades will go against you. There are several trading tools, however, that can minimize your risk, and with caution, and above all education, the FOREX trader can learn how to trade profitably and while minimizing losses.
Trading Currencies on Margin
The key to FOREX popularity is margin. Without margin, the FOREX would be beyond the reach of the average investor. So, what exactly is margin and how does it work?
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