How to Choose a Forex Broker
Choosing a good forex broker is one of the most important decisions you need to make at the beginning (or at any point) of your forex trading career. Do not take this decision lightly, but at the same time don’t stress over it – the process does not need to be complicated – just like in your trading decisions, once you do your homework, things tend to fall into place.
Chance favors the prepared trader and everything you need to make an informed decision is listed right here. All you have to do is follow the advice given and you will find yourself a broker that suits your needs.
Regulation
The first thing you need to do is check whether the broker is regulated. The fact that the forex market itself is not regulated opens the door to a lot of possibilities for a scheming mind.
There are shifty brokers out there, ranging from outright scams to just badly run businesses which are not accountable to any regulatory body. The brokers who are regulated choose to be so, in order to add a layer of legitimacy to their reputation. Please do NOT fund any accounts with an unregulated forex broker.
There are not many good reason to do so, and plenty of reasons not to. It just makes sense.
Most forex brokers, even if they are not based in the United States
The UK based Financial Services Authority (FSA) is also a well respected regulating body, as is CySEC (Cyprus), ARIF (Switzerland), ASIC (Australia) and SFC (Hong Kong) among others.
Just because a firm writes on their website that they are regulated however, does not make it so. Always check the websites of the regulating bodies themselves – they all offer a searchable database that allows visitors to find regulated members by name
NFA/CFTC:http://www.nfa.futures.org/basicnet/
SFC:http://www.sfc.hk/sfcprd/eng/pr/html/PR002.jsp?charset=ISO8859_1
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