Factors affecting Choice

A FOREX Broker is a foreign exchange market expert, who as a middleman trades on behalf of his client and acquires commission for that trading. An ECN Broker is a person/company, who does the same but using online facilities of trading. There terms like commission, market order slippage or stop order slippage have different effects and meanings for both.

Throughout the world the FOREX markets remain open round the clock and 5 days a week. The day time trading continues with the shift of day from Auckland, Tokyo and Sydney (the eastern borders of the world) to New York (the west). Major financial centers facilitate this trading for buyers and sellers of foreign currency round the clock all over the world.

Forex brokers have made it possible for retail investors to access the interbank market for trading currencies. They generally have a proprietary trading platform through which traders place buy and sell orders on currency pairs. In this way even small traders can access the 24 hour trading currency markets.

There are several factors to be taken into consideration when choosing a forex broker.

• The UK Forex broker must be FSA regulated and the UK Forex broker reviews should have a supportive statement for the broker.
• A spread is the difference between the bid and ask price of a currency pair i.e; the price at which you can buy and sell a pair. The brokers offering low spreads are to be preferred as this increases your profit margin.
• Look for brokers providing 1:100 or 1:200 leverage. The forex markets are highly liquid. Hence they make entering and exiting positions very easy. Leverage can be very profitable when you are in a winning position. If in a losing position, that position can be closed early to minimize losses.
• Be sure to test drive the practice account that several online brokers offer, before opening an account. In this way you can familiarize yourself with their trading platform. Their quotes, trade execution, charting package and other aspects of their brokerage are to be considered.
• Several brokerages are very helpful in providing tools to help their traders succeed. Look for comprehensive charting packages with a wide range of technical indicators; reliable and well known news feeds; fundamental and technical analysis commentaries; economic calendars; good money management tools.
• It should be easy to reach broker through internet or via telephone. There should be good customer service.
• There should be different account sizes offered by broker such as standard, micro and mini account. It is usually a good idea to start with a small account.
• Different types of trading platform are offered-either a java web based or software installed on computer. Test these to see what suites you.