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How to Choose a Forex Broker

Michael Fasogbon

Updated:
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Until a little more than a decade ago investing meant doing all your trading by phone. For every action, you had to call your broker and place an order. Online trading has changed all that and today you can manage every aspect of your trading right from the broker’s online trading platform. Simple, right? But the question is how to choose a Forex broker when there are so many choices on the net today. New traders are offered a huge variety of Forex brokers to choose from. So how do you choose? It all comes down to finding the broker that you think will best suit your needs. We are here to help you do just that.

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4 Providers that match your filters

Payment methods

Trading platforms

Regulated by

Support

Min.Deposit

$ 1

Leverage max

1

Currency Pairs

1+

Classification

1or more

Mobile App

1or more
Recommended

Rating

Total cost

$ 0 Commission 3.5

Mobile App
10/10

Min.Deposit

$100

Spread min.

Variables pips

Leverage max

100

Currency Pairs

40

Trading platforms

Demo
Webtrader
Mt4
MT5

Funding Methods

Bank Transfer Credit Card Giropay Neteller Paypal Sepa Transfer Skrill

Regulated by

FCA

What you can trade

Forex

Indices

Actions

Cryptocurrencies

Raw Materials

Average spread

EUR/GBP

-

EUR/USD

-

EUR/JPY

0.3

EUR/CHF

0.2

GBP/USD

0.0

GBP/JPY

0.1

GBP/CHF

0.3

USD/JPY

0.0

USD/CHF

0.2

CHF/JPY

0.3

Additional Fee

Continuous rate

Variables

Conversión

Variables pips

Regulation

Yes

FCA

No

CYSEC

No

ASIC

No

CFTC

No

NFA

No

BAFIN

No

CMA

No

SCB

No

DFSA

No

CBFSAI

No

BVIFSC

No

FSCA

No

FSA

No

FFAJ

No

ADGM

No

FRSA

71% of retail investor accounts lose money when trading CFDs with this provider.

Rating

Total cost

$ 0 Commission 0

Mobile App
10/10

Min.Deposit

$100

Spread min.

- pips

Leverage max

400

Currency Pairs

50

Trading platforms

Demo
Webtrader
Mt4
MT5
Avasocial
Ava Options

Funding Methods

Bank Transfer Credit Card Neteller Skrill

Regulated by

CYSECASICCBFSAIBVIFSCFSCAFSAFFAJADGMFRSA

What you can trade

Forex

Indices

Actions

Cryptocurrencies

Raw Materials

Etfs

Average spread

EUR/GBP

1

EUR/USD

0.9

EUR/JPY

1

EUR/CHF

1

GBP/USD

1

GBP/JPY

1

GBP/CHF

1

USD/JPY

1

USD/CHF

1

CHF/JPY

1

Additional Fee

Continuous rate

-

Conversión

- pips

Regulation

No

FCA

Yes

CYSEC

Yes

ASIC

No

CFTC

No

NFA

No

BAFIN

No

CMA

No

SCB

No

DFSA

Yes

CBFSAI

Yes

BVIFSC

Yes

FSCA

Yes

FSA

Yes

FFAJ

Yes

ADGM

Yes

FRSA

71% of retail investor accounts lose money when trading CFDs with this provider.

Rating

Total cost

$ 0 Commission 6.00

Mobile App
7/10

Min.Deposit

$10

Spread min.

- pips

Leverage max

10

Currency Pairs

60

Trading platforms

Demo
Webtrader
Mt4

Funding Methods

Credit Card

What you can trade

Forex

Indices

Cryptocurrencies

Average spread

EUR/GBP

1

EUR/USD

1

EUR/JPY

1

EUR/CHF

1

GBP/USD

1

GBP/JPY

1

GBP/CHF

1

USD/JPY

1

USD/CHF

1

CHF/JPY

1

Additional Fee

Continuous rate

-

Conversión

- pips

Regulation

No

FCA

No

CYSEC

No

ASIC

No

CFTC

No

NFA

No

BAFIN

No

CMA

No

SCB

No

DFSA

No

CBFSAI

No

BVIFSC

No

FSCA

No

FSA

No

FFAJ

No

ADGM

No

FRSA

Your capital is at risk.

Rating

Total cost

$ 0 Commission 0.1

Mobile App
10/10

Min.Deposit

$50

Spread min.

- pips

Leverage max

500

Currency Pairs

40

Trading platforms

Demo
Webtrader
Mt4
STP/DMA
MT5

Funding Methods

Bank Transfer Credit Card Neteller Skrill

What you can trade

Forex

Indices

Actions

Raw Materials

Average spread

EUR/GBP

-

EUR/USD

-

EUR/JPY

-

EUR/CHF

-

GBP/USD

-

GBP/JPY

-

GBP/CHF

-

USD/JPY

-

USD/CHF

-

CHF/JPY

-

Additional Fee

Continuous rate

-

Conversión

- pips

Regulation

No

FCA

No

CYSEC

No

ASIC

No

CFTC

No

NFA

No

BAFIN

No

CMA

No

SCB

No

DFSA

No

CBFSAI

No

BVIFSC

No

FSCA

No

FSA

No

FFAJ

No

ADGM

No

FRSA

71% of retail investor accounts lose money when trading CFDs with this provider.

 

Remember: there is no such thing as “the best Forex broker”. What you’re looking for is the best broker for your needs. By knowing the kind of trading experience you want to get, you can decide on the broker who is right for you.

In this article, we will try to make the selection process simpler and easier so you can focus on investment opportunities, rather than which online broker to trade with.

Main Parameters to Check Before Choosing a Good Forex Broker

 

1. Regulations/ Licenses

We advise you to only choose brokers authorized and regulated by leading regulation authorities like CFTC, NFA, FSA.
Why? It indicates a broker’s reliability and will protect your money.
Plus500 and AvaTrade are good examples for fully regulated online brokers.

2. Easy to Use Forex Trading Platform

Online Forex trading needs to be simple, intuitive and easy to trade. A good User Interface is important.
Markets.com, Plus500, and eToro have the best Forex trading platforms in the industry for beginners.

3. Customer Support

This is a key point. Good and efficient support is a must because you are probably going to use it.
We advise you to communicate a bit with brokers’ customer service reps before depositing.
Ask a few questions by mail or over the phone before opening an account.
Get a feeling for the speed of service as well as its quality and availability.
eToro, 4XP, and FXCM all provide fast, high-quality support.

4. Leverage Options

Different Forex brokers offer different leverages.
The higher the leverage you use, the more profit you can potentially make, but the higher the risk you will take also.
That’s why there is no best level of leverage, it depends on your trading style.
There are some brokers that offer up to x100, x200 and even more in some cases.

5. First Deposit Bonus

Each broker wants to attract you with high capital bonuses on your first deposit.
In this case, you get extra money to trade with. There are a few brokers offering great starting bonuses. One example is AvaTrade’s offer of up to 100%. eToro also runs some very attractive promotions.

6. Deposits and withdrawals

You need to pay attention to the broker policy regarding withdrawals.
Check out the waiting time for your withdrawals and other written policies.

7. Trading Costs

Brokers make money through the fees traders pay. A significant source of revenue (for your broker) and operating expense (for you – the trader) will be the spread –
the price difference between the bid and ask prices.

Know how your broker handles spreads:

  • Are spreads fixed or variable?
  • What is the average (and MAX) spread for each of the currency pairs you plan to trade?
  • What are the spreads during times of high volatility?
  • Are there commissions per trade, in addition to the spread. FXCM and eToro all offer fixed spreads.

 

8. Demo Account

Have you ever bought a car without taking it for a test drive, first? We certainly hope not.
Likewise, you should open a practice account with any broker you are planning to trade with.
Almost all brokers now offer practice accounts, which let you get a feel for the broker before committing any money.
It allows you to practice on virtual money before you decide to start trading your real capital.
It also allows you to test the broker’s trading platform. Plus500 offers unlimited demo account for their customers.

Additional Parameters for Choosing the Best Forex Broker

Account Minimums

Some brokerages offer rock-bottom account minimums. You don’t need to deposit high capital anymore, in order to trade Forex.

Promotions

Online brokers will try to snag your business by offering promotions. Cash and prizes are all part of the game.

Education

The educational services your broker provides will aid in your mastery of the Forex market. Most brokers offer a variety of educational tools to assist in a trader’s assessment of the Forex market. Learn 2 Trade has done the market research for you – check out the Best Forex brokers here.

In conclusion

Choosing the best Forex broker could make the difference between making money and losing money. Make sure you choose the broker that will provide you the best possible environment to succeed in. Above all, a broker that you can trust.