The Best Way to Find a Broker
Every trader knows that he or she will need a broker to trade in the Forex market. Yet they dont know how to find a good Forex broker. There are many brokers in the Forex market. And there are many different types of brokers. Knowing how to find a broker is not a decision that should be made lightly.
When a person begins to make inquiries about trading Forex, he or she could be inundated with advertisements from brokers offering to help him or her trade in the Forex market easily, effortlessly, and inexpensively. Most of these brokers will be legitimate, but a few will be fraudulent. Beginning traders need to know the signs of an unscrupulous broker to avoid becoming a victim of Forex fraud.
The Best Way for New Traders
Many people dont have any experience with brokerage houses or individual brokers. As the Forex market opens up to individuals, the number of new traders is growing. Dont feel alone or alarmed because there are ways for a new trader to find a legitimate broker.
The best way for beginning traders to find a broker is to contact the National Futures Association. This organization monitors brokerage firms and brokers in the currencies market. It is a voluntary organization, but holds its members to very high standards, has a complaint and disciplinary procedure, and oversees the actions of its members. It is one of the best sources of information on a brokerage firm.
Anyone can obtain a directory of the NFAs members. This directory will list all its members, provide contact details, and give the most current information (including complaints and disciplinary action) about the brokerage firm. It is an excellent way to begin the search for a Forex broker. To obtain this important directory, contact the NFA and complete the NFA Directory Order Form.
If you have already identified a broker, but you need more information, you can search the NFAs database for the most current information and details about the broker.
The Best Steps:
The Best Way for Experienced Traders
Several brokerage houses can trade in many different markets. For traders who have experience with trading stocks, options, or commodities, the best way could be to use their current broker if they have access to the Forex market.
If the current broker does not have this type of access, the trader could obtain a recommendation from their current broker about legitimate brokers in the Forex market. This is not to say that the trader should use any Forex broker who advertises with the current broker. No, an advertisement is not an endorsement. The trader should talk directly to the customer service department and ask about their recommendation for a Forex broker.
Alternatively, the trader can contact the National Futures Association.
The Best Steps:
- Use your current stock or commodities broker.
- Ask your broker for a recommendation.
- Talk directly to an in-house broker or customer service agent.
- Avoid advertisements.
- Contact the NFA (see above information for new traders).
One of the most important decisions to make for beginning traders is how to find a legitimate broker. Dont take this decision lightly. This will be a relationship that should last a long time. It will also involve constant contact and a financial commitment.
Taking the above steps will help all traders reduce the risk of becoming the victim of a Forex scam and protect the money committed to trading currencies.