How to choose a good US Forex Broker
While there are plenty of Forex brokers around, not all of them can satisfy your needs. This is why it is crucial to find a company that will be reliable and will offer top-notch services at the same time. It is not an easy task but using the criteria we are going to describe below, you will succeed.
Regulated or unregulated brokers?
The first thing many traders take note of is the license. All reliable companies in the United States are regulated. Some of them are licensed by the local regulatory authorities like SEC, CFTC, or NFA. However, many brokers are regulated outside the United States.
While everything is simple in the first case, the latter is not so clear. When you choose a company with a foreign license, you need to keep in mind that your rights will also be protected. However, in case of any disputes, you will have to deal with a foreign jurisdiction. US regulators will be unable to protect you.
When dealing with unregulated companies, you are not protected at all. Some of those companies are good but in most cases, they end up the same way – most of them shut down when they think their business is not profitable anymore. This means they may close at any moment and you will be unable to cash out your profits and even your deposits.
This is the second important criteria you need to look at when choosing a brokerage company. Trading conditions may vary depending on a particular firm. Some brokers offer lower spreads and commissions, some have lower minimum deposit requirements.
If you are going to use high-frequency trading strategies, it is better to look for those companies with lower spread amounts. The math behind this is simple. You will open many trades during the day and each time you place orders and they are executed, you pay a commission to your broker. The lower this commission is, the more money you will put into your pocket if successful.
When it comes to minimum deposit, many US Forex brokers require $100 at least. This is an average amount and it is not enough for serious trading strategies. However, by depositing $100, you will be able to test the company and to understand whether it is a good choice or not.
The range of financial instruments also matters. If you want to use a couple of currency pairs, this parameter is not important for your at all. However, if your trading strategies allow you to buy various assets like currencies, cryptos, shares, etc, it is better to look for brokers with a broader range of financial instruments.
Most US Forex brokers offer their own proprietary trading terminals. They can be both web-based or desktop. What to look for when choosing a platform?
It should be functional. Modern trading platforms are designed for various purposes. The main idea is to place orders. However, you can also conduct market analysis using technical indicators or graphic tools. Some trading platforms allow you to use a robot and even to test your strategies.
If a company has a third-party trading terminal, you will have even more features to benefit from. Such platforms like Metatrader or Trade Station are designed for professional traders and they allow you to use any strategy at full pace.
Education and analytics
US Forex brokers offer various additional services to their customers. If you are a beginner trader, you will definitely need some skills and knowledge to start. Most brokers provide traders with detailed guides on financial markets and trading basics.
What are those guides? You will learn more about market analysis and trading strategies. Educational materials will teach you how to place orders and protect your market positions from bigger losses. And that’s not all. You will learn the basics of trading psychology, which is very important when dealing with financial markets.
Some companies offer advanced courses for skilled traders to hone their knowledge. Those guides contain advanced strategies and tips on trading.
As for market research, most US Forex brokers give their customers insight into the financial markets situation. You can benefit from daily reviews, fundamental research, trading signals, etc.
If a trader has no skills to trade, he can choose various social platforms to invest money. Those websites provide you with all the necessary information about managing traders. Your only task is to choose between thousands of offers.
There are dozens of other services that you can find when dealing with a particular brokerage firm. Some of them offer retirement plans, passive investment opportunities, low-risk assets, and others.
Now you are “armed” to find a good and reliable Forex broker in the United States. You can pay attention to the companies that we have described in this guide. Those FX brokers are trustworthy as most of them are regulated in the United States and have a very good reputation. However, if you want to make your own research, those criteria we have described here will help you to pick an appropriate brokerage firm.