A broker represents an intermediary between a trader and financial products and services. You can find brokers in insurance, vehicle sales, etc. The main aim of this type of broker is to offer affordable prices to its clients by playing on the quantities.
There are also foreign currency exchange brokers. Here we focus on Them.
The financial authorities regulate the Forex brokerage activity. Never choose the broker who doesn’t possess the incense.
Sometimes, there are businesses operating honestly but do not have the licence. It means that you are not shielded from scams.
Individual Forex trading on the rise
The advent of the Internet has allowed the development of individual trading and, therefore, the activities of brokers. Previously, you had to go to your bank or make a phone call to buy/sell a financial product; now, all you have to do is connect to the Internet and create your trading workstation. A and in two clicks, the order is placed, the capital gains could be saved and transmitted directly to your bank account. There are brokers even offering a credit card to their clients in order to pay directly with the profits from the trading.
The emergence of new Forex brokerage players on the market
This phenomenon has obviously had good and bad consequences on the sector. On the bright side, financial markets have evolved as more and more people have started to trade more, better, more often. New financial products have appeared, allowing everyone to find the shoe to their feet according to their expectations, objectives, schedules and financial means. TradeVTech operates from 2020 and has a lot to offer. Learn more by perusing the TradeVtech review.
Among the negative points, we have seen the emergence of more and more brokerage players, a good majority of which have shown themselves to be unscrupulous of legal and moral rules (poor or non-transmission of client orders, high costs, non-existent after-sales service or foreign language, etc.).
The role of your broker – what to look at when choosing the broker
Forex brokers cover many aspects of your trading career. The broker manages your trading account. It executes your market entry and exit orders and charges a commission for this. The company is the intermediary between you and the market. You cannot trade without it, but that does not exempt you from being attentive to offered services.
Your chosen broker must have direct access to the markets you want to trade, with no intermediary between the market and him. Access to the broker’s platform should be easy for you to use, even if one can quickly learn, try to trade in your language or the one you understand. Avoid brokers whose prices are prohibitive.
Some brokers (but not all), to allow their clients to trade on the currency market (Forex), do not charge you a commission but offer you a spread. The spread is the difference between the purchase price (ask) and the sale price (bid). The advantage for a trader to trade with a spread is that there is no commission. The downside is in terms of timing: the Forex broker (market maker) will not allow you to exit once on the market as long as the price remains in a specific price range.