How to choose best Forex broker in United States

How to choose best Forex broker in United States

Investing in financial instruments of US companies is a very striking alternative for many investors due to the growth shown by these companies and the projection of better dividends.

That is why it is essential to choose among the best brokers to operate in the United States so that the operations you carry out are safe and have a wide range of options when it comes to investing.

Forex Regulation in the United States

Forex Brokers

Exchange operations are regulated by the NFA (National Futures Association) and the CFTC in the United States. Some of these regulations that must be followed are listed below:

  • Limit leverage to 50: 1 in major currencies.
  • Limit the leverage of 20: 1 in smaller currencies.
  • Rule of First in, First out (FIFO).
  • US residents. They can only trade with US Forex brokers. In accordance with the regulations of the NFA.
  • The money owed by the FX broker to the customer must be kept in one or more qualified institutions in the United States.
  • Retail currency brokers in the United States must maintain a minimum capital of at least $ 20 million and 5% of the amount for which liabilities to FX retail customers exceed $ 10 million. Making it difficult for any newcomer to the business, since it takes a lot of capital just to get started.
  • Provide weekly financial statements to the NFA to ensure all financial accounts are in order.
  • No coverage allowed.

INFO on US currency brokers

The popularity of currency trading continues to increase. The market is literally flooded by thousands of Forex brokers from different countries.

The existence of so many options overwhelms new merchants. Choosing the right Forex broker is essential to become a successful trader.

Unfortunately, the Forex trading market does not have a universal regulation, unlike the stock market. Traders are responsible for choosing licensed and regulated foreign exchange brokers.

Many countries allow Forex brokers to operate without strict licensing requirements.

US foreign brokers are one of the safest brokers because they operate with an appropriate license. Regulated Forex brokers must guarantee the security of the funds invested, thus protecting your money.

The US government has taken immense measures to regulate the forex trading market.

Currency brokers that operate outside the US must comply with the requirements of the NFA (National Futures Association) and CFTC (Commodities & Futures Trading Commission).

Some FX brokers complain that strict regulations prevent them from providing great profit opportunities for their traders. However, these regulations ensure that operators can have peace of mind while investing their money in a highly volatile market.

US Forex Brokers must comply with the NFA regulations and register with CFTC, before beginning currency operations in the US.

This was not the case before 2008. Previously, any broker from anywhere in the world could provide currency trading services to US citizens.

After numerous scams and frauds, NFA and CFTC have limited the freedom of retail currency exchange agents.

Points to choose from the best brokers to operate in the United States

Some of the features to consider when choosing a broker with which to operate in the United States are:

Transaction fees: The broker fee is charged every time we make a purchase or sale. A good broker has costs for smooth transactions, that is, no matter the amount or amount of shares of each operation, the commission will always be the same.

Customer service: Prompt response to questions or complaints is essential for any broker, so those operating in the United States should not be the exception.

You must provide the client with an efficient means of communication to answer the requirements in a timely manner and in a short time.

Minimum deposit: If you are starting with brokers operating in the United States, you must verify how much the broker asks for as an initial deposit.

Forex Brokers

There will be some that will allow you to start operating with small amounts of between 10 and 100 dollars, others ask for higher amounts of between 250 and 500 dollars, and others do not ask for anything to start operating since they offer you the option to lend you the capital initial.

Trading tools: Of course, you should verify that the broker has not only the financial instruments to invest in but also the trading tools, such as MetaTrader, to do so in order for the investor to make the best decisions and have a greater probability of success in your operations.

Additional charges: Are there hidden fees or additional charges for services? It is essential that you know them before choosing a broker.

Diversity of ways to invest: A good broker not only allows you to invest in stocks but also offers the investor a wide range of investment methods such as options, ETF’s, mutual funds, bonds, etc.

Taxes: It is important to note that if you are a resident of another country and want to open an account in a broker that operates in the United States, you must pay taxes to this country for the transactions you make.

Payment methods and withdrawals: The most common is that US banks are used to operate with shares in this country.

But for investors living in other countries, the broker must offer the broker must provide different options to deposit and withdraw money, such as Visa or MasterCard, Skrill, Neteller, among others.

Author : Michael Fasogbon

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Michael Fasogbon is a professional Forex trader and cryptocurrency technical analyst with over five years of trading experience. Years back, he became passionate about blockchain technology and cryptocurrency through his sister and has since been following the market wave.