Forex market is extremely competitive, which why finding the right brokers can be quite a daunting task, especially for a newbie trader. When you are looking around for a suitable brokerage platform to open a trading account, it is vital to consider certain factors.
Features to consider, while choosing a brokerage platform
– Security – Good brokers provide high-level protection to their members. Actually, you are entrusting thousands of Dollars to a stranger, who claims to be legit. That is why; you must make it a point to check the Forex broker’s credibility at the regulatory agencies of their respective countries, before signing up.
– Transaction costs – Every time a trade is placed, the trader has to pay brokerage charges. Therefore, look for the brokerage rates that best suit your trading styles. However, it is important for you to find the broker who provides the right balance of low transaction costs, proper customer support, and security.
– Deposit & withdrawal – A good Forex trading platform allows its users to deposit and withdraw without any hassles. Make sure that the withdrawal process on the platform you choose is smooth and speedy.
– Trading platform – Trading activities occur through the dealer’s website. Make sure that the trading platform provided is stable and user-friendly. Also, check the tools and indicators provided by your broker to help you make the right the market analysis.
– Execution – A good broker platform will provide you with the real time information and economic news, to help you make the best speculations. For a scalper, speed to fill orders is vital, because a few pips differentiation in price can hinder your chances of winning that transaction.
– Customer service – Technical issues can arise anytime, so look for a broker who provides prompt and effective customer support. During the account opening process, the broker may be helpful and kind, but their ‘post-sale’ support might not be up to the mark. Therefore, look through reviews and testimonials to get an idea of the service quality.
How to open a Forex trading account?
After you select a trading platform, it is time to open an account. This can be done through 3 simple steps.
1. Choose account type – Forex trading accounts are of two types – Personal or Business (Aka Corporate). In the past, traders had to select between ‘standard’, ‘mini’ and ‘micro’ account.
Today, the majority of brokers allow traders to deal with custom lots. It gives more flexibility for the new and inexperienced traders. They won’t have to trade with more capital than what they are comfortable with. Once they start making regular winning trades, then they can go for premium membership accounts to improve their trading portfolio and profits.
It is advised to read the small prints, always. Several brokers have managed account option on their application form. It means the broker will conduct trades, on your behalf. However, opening managed account will require more of minimum deposit. Also, the broker will take a cut on every winning transaction.
2. Registration – The registration form for opening a new account will vary from one platform to another. Basically, you will view it in a PDF format, which can be printed.
3. Account activation – After the broker receives the necessary documents, an email will be sent to you, with instructions to conclude your account activation. After you take care of these steps, a final email with fund instructions, username, and password will be sent to you.
Now, your trading account is activated, so enjoy trading! Your broker will also provide you with many useful resources that will help you in better understanding Forex.
Before opening an account DEMO trade first
Experts strongly advise traders to work with demo accounts first. DEMO trading for minimum 3-6 months is suggested, before getting on with LIVE trading. First, take a dip in the shallow end, so that you get an idea of the risks that you will come across.
Trading LIVE is totally different. No matter how much success you get with your DEMO account, your real learning will actually start when you enter into live trading.