Getting the right Forex broker

Some more factors, continued from the last post,need to be considered while researching for a reliable forex broker.

Leverage Offered;
In forex leverage is crucial as the price deviations which is the actual source of profit, are simple fractions of a cent. Leverage, in forex as elsewhere, the ratios between the total capital available to the real capital, is what the broker lends the trader for trading. A ratio of 200:1 would mean the broker lends $200 for every $1 of real capital. Forex Brokers may provide leverage as high as 250:1, however, lower leverage translates into a relatively lower risk of lower margin call the trader may need to pay. Again, lower leverage will mean lower returns on the investment as well.
The best idea here is that if you have limited capital, get a forex broker who offers the highest leverage.


Types of accounts:
Many forex brokers let you open more than two types of accounts. The mini account usually can be opened with a deposit as low as $250. A standard account can be opened with a capital of $2,000, which mostly offers a variety of leverages. With Premium accounts the capital is obviously significant and different amounts of leverage can be used, not to mention additional services and tools.
The forex broker here needs to compliment our capital by offering relative leverage, tools and services,.

Other factors:
Forex Brokers may resort to “premature buying and selling” near decided points. The only way of finding out honest brokers is through fellow traders. Forums come in handy in such situations to discuss about brokers who are known not to commit such shady acts.

Similarly, trading with borrowed money means the broker can liquidate the position on a low margin call, which can prove dear to us a trader. Online discussion platforms can prove a good place again to discuss forex brokers.

Forex is increasingly getting people interested. That however cannot substitute for the research we need before zeroing in on a broker. As also for working out a strategy that’s best for us. The top way remains that we try out forex on a demo account before gong live.