A blogger should always make sure that his readers understand the subject and the terms of the discussion first. The subject should always be described and be broken into pieces so that everyone should understand exactly what he is talking about. I am not a FOREX guru neither a FOREX broker but I am just a novice who likes to share the little knowledge I have with my FOREX compatriots. Since our today’s topic is FOREX brokers we will explain the two terms FOREX and Brokers first before anything.
This is a very huge liquid market in the world whereby people trade all currencies of the world. People trade currencies to use them in their destined countries when traveling; however some people take advantage on trading currencies for profit, I call this type ( FOREX Traders) meaning that they buy at the low price and sell very high, otherwise who can ignore this simple business opportunity?, you only sit on your computer and watch money flowing in. However you must always remember that in order to make money you also need to spend some money.
These are registered companies or firms who allow people to use their trading platforms, they allow them to buy and sell diverse currencies. They are also the agents who organize, negotiate, buy and sell currencies or assets for others , they normally make profit out of their proxy business or through spreads.
Brokerage Firm ( FOREX Brokers) and TechnologyMost people are on the opinion that the word FOREX Broker is a dying breed. With all of the technological improvements in field, most people now rely strongly on computers and perceive no need for a FOREX broker. I would caution! This line of thoughts, however. If you want the convenience of an online system but the security of having someone there to answer your queries, find a brokerage firm that does both. Most FOREX brokers understand the need for 24-hour access, and have online portfolios and trading available to their customers. When you have a tough query or dilemma, you will be happy you kept your FOREX broker around.
Current Top broker benefits
FOREX brokers differ greatly depending on the capacity of their organization. You don’t necessarily have to go with one of the best FOREX broker to have a good trading experience, however. You will want to look for a FOREX broker firm that offers real-time access, price certainty, competitive pricing, and competitive spreads.
Services of FOREX Brokers
The huge the FOREX broker firm is, then the lesser their spreads and prices will be. They have more pull in the market and are able to negotiate prices better than a smaller FOREX broker. Weigh all the benefits and downfalls to each firm to ensure a quality decision. A good price does not always mean the best broker, so choose with caution.
Why Choosing a Broker ?
There are certain query that you will want to ask to your prospective FOREX broker. Such questions include:
- What is a spread? (Hint: The lower the spread the more money you make!) The spread is calculated in “pips” and is the difference between the price at which a currency can be purchased and the price at which it can be sold. Simply put, your FOREX broker has to make money. That’s how they stay in business. Unlike traditional stock trading where brokers charge commissions, FOREX brokers make money off the spread. The lower the spread the more profit that there is for you.
- What are your credentials? (Hint: There are certain affiliations you should look for.) a. Most huge brokerage firms are linked in some way to a bank or financial institution. Since the majority of their business is based on credit, this is a very crucial partnership. Their affiliation offers you the opportunity to invest thousands more than you could with smaller firms. It is also recommended that your chosen FOREX broker should be registered with Futures Commission Merchant (F.C.M) and regulated by the Commodity Futures Trading Commission (C.F.T.C). Refer to your broker’s website or call directly to find out if they have such affiliations.
- What resources they have? (Hint: Not all broker firms are built equal. Find out who offers the best resources and information to help you make the smartest trading decisions.) a. This is a critical question to ask. It is one thing to fulfill your trade requirements, but a FOREX broker needs to also provide you with educational tools. Ask what kind of tools they offer for their clients. A good company should offer real-time charts, technical analysis tools, real-time news and data, and software or website support. Be weary of any company that refuses to share information or trial versions before opening up an account. You will want to try out their system before you choose to invest money in it. Many offer test accounts that allow you to “play” the market without actually investing any capital.What tools are available to help me learn more?
- What is your leverage? (Hint: This is the determining factor on how much money you are able to make with each investment.) a. Leverage is the key factor to your success. As discussed earlier, the FOREX market runs mostly on credit. Your FOREX broker is able to supply you with a different margin depending on their size and your needs. The higher the margin the more money you can possibly make. If you are limited on funds, finding a high margin FOREX broker is top priority. If you have the capital already, you may decide that a lower margin is a smart choice for higher risk transactions and vice versa.
Types of FOREX Brokers
> introducing FOREX Brokers – This program is ideal for serious individuals or companies who would like to either spread their knowledge of the FOREX market to their existing clients or contacts or provide a value added service. Introducing FOREX Brokers do not have to manage or trade any client funds. Those who which to do so have to comply with more extensive requirements. Our program is divided into two different levels to better fit your business model.
< Institutional FOREX Broker > – is a serious business whose major source of income comes from offering FOREX products and services. These participants must offer a value added service. This will not only help differentiate the company from the competition but will provide the customer an incentive for signing up through the I.B. Account opening and all administrative duties are still handled by A.F.M as well as customer service and tech support. Institutional FOREX brokers must have an existing trading account so that they can provide further assistance to the customer based on their experience. Based on the number of clients and trading volume, a successful Institutional Broker will be very well compensated. By teaming up with A.F.M, an Introducing FOREX Broker can be confident in that they will be part of a strong partnership aimed at providing excellent service in the FOREX market. Institutional Brokers can offer their clients access to A.F.M high-quality FOREX platform and trading expertise. A.F.M will provide strong back office support where the I.B will always have access to track its progress. Most of our I.B.s start by facilitating the account opening and funding process for clients. Clients look for I.B.s they can trust and have confidence in.
< The Online Service Provider > – This are professionals who wish to market our services as different to a FOREX broker. This is ideal for an existing website owner who wishes to link to us or provide access to demo accounts and live account applications. The site must fit our profile and be in the same or similar industry. By becoming an online service provider, useful content can be provided to post for your online visitors.
< White labeling > – This is available for registered entities. They must be a Futures Commission Merchants and regulated in their jurisdiction. They must be an existing financial institution permitted to accept funds on behalf of their clients and you should not confuse them with FOREX brokers. This is a perfect program for small banks or equity FOREX brokers. Entities that are accepted as a White Label will be provided with a customized solution for their business. The trading platform as well as all correspondence will carry the company’s brand identity. White Labels can extend the companies product line by venturing into the FOREX market with a proven leader. While A.F.M remains a price maker and counter party to every transaction, the White Label I.B will take on back office responsibilities. Installation and access to our back office application will be provided. A.F.M will work behind the scenes while giving the entity and its clients access to the FOREX market. Just like A.F.M, White Labels will be expected to follow the highest standards in ethics and corporate responsibility.
FOREX Brokers/ Financial Institution Regulators
Recommended FOREX Brokers
Every FOREX broker or any financial institution need to be registered in their country of trade since they will be dealing with finances of people. The regulations may differ from country to country. These regulators protect the integrity of financial institution within every country and also the finances of individual, List of countries regulators;
- Argentina [The Stock Market National Committee]
- Australia [Australian Securities and Investments Commission]
- Australia [Australian Prudential Regulation Authority]
- Australia [Australian Transaction Report and Analysis Center]
- Austria [Financial Market Authority]
- Bahamas [securities Commission of The Bahamas]
- Bahrain [Central Bank of Bahrain]
- Belgium [Financial Services and Markets Authority]
- Belize [International Financial Services Commission]
- Botswana [Non-Bank Financial Institutions Regulatory Authority]
- Brazil [Securities and Exchange Commission of Brazil]
- British Virgin Islands [Financial Services Commission]
- Bulgaria [Bulgarian National Bank]
- Canada [Investment Industry Regulatory Organization of Canada]
- Canada [Canadian Investor Protection Fund]
- China [China Securities Regulatory Commission]
- China [Financial Supervisory Commission]
- Croatia [Croatian Financial Services Supervisory Agency]
- Cyprus [Cyprus Securities and Exchange Commission]
- Czech Republic [Czech National Bank]
- Denmark [Denmark Financial Supervision Authority]
- Egypt [Egyptian Financial Supervisory Authority]
- Estonia [Financial Supervision Authority]
- Estonia [Ministry of Economic Affairs and Communications]
- Finland [Financial Supervision Authority]
- France [Financial Markets Authority]
- France [Credit Institutions and Investment Firms Committee]
- France [The Financial Firms Register]
- Germany [Federal Financial Supervisory Authority]
- Gibraltar [Financial Services Commission]
- Greece [Capital Markets Commission]
- Hong Kong [The Securities and Futures Commission]
- Hong Kong [The Financial Commission]
- Hungary [Hungarian Financial Supervisory Authority]
- Hungary [Central Bank of Hungary]
- India [Securities and Exchange Board of India]
- India [Central Depository Services Limited]
- India [National Securities Depository]
- Indonesia [Commodity Futures Trading Regulatory Agency]
- Ireland [Central Bank of Ireland]
- Israel [Israel Securities Authority]
- Italy [National Commission for Companies and the Stock Exchange]
- Jamaica [Financial Services Commission]
- Japan [Japan Securities Dealers Association]
- Japan [Financial Services Agency]
- Jordan [Jordan Securities Commission]
- Kenya [Kenya Capital Markets Authority]
- Kuwait [Kuwait Chamber of Commerce & Industry]
- Latvia [Financial and Capital Market Commission]
- Lebanon Central [bank of Lebanon]
- Lebanon [The Arab Federation of Exchanges]
- Lithuania [Lithuanian Securities Commission]
- Malta [Malta Financial Services Authority]
- Mauritius [Financial Services Commission]
- Morocco [Moroccan Financial markets Authority]
- Netherlands [Financial Markets Authority]
- New Zealand [Financial Service Providers Register]
- New Zealand [Financial Service Providers Register]
- New Zealand [Financial Dispute Resolution Service]
- United Kingdom [The Financial Conduct Authority]
- United States [National Futures Association]
A word of advice to all FOREX traders, newbies and professionals should always make sure to check the FOREX Broker they wish to invest their money with whether it is registered or not. The list of Regulators may be a good source to help you check. Never get carried away with FOREX brokers promising you heaven and earth when they don’t have. Conduct a 100% thoroughly research analysis. It is easy to report a financial institution that does not comply when registered but if not registered there is nowhere to report.
We as A.F.M FOREX are here to help you report any monies you lost through any FOREX broker, feel free to expose or applaud any broker. Comment below.