Day Trading Guide – Chapter 10: Choosing a broker

By:

Updated: Mar 5, 2019, 13:14 GMT+00:00

This is chapter number 10 out of 13. Read the rest: Read Day Trading Guide – Chapter 1: Introduction Read Day Trading Guide – Chapter 2: An overview of

Day Trading Guide – Chapter 10: Choosing a broker

This is chapter number 10 out of 13. Read the rest:

With the large number of brokers offering their service online, it is not unexpected that you be easily overwhelmed. Deciding which broker to sign up with entails that you expend some time to make inquiries into the services these brokers can provide. On the other hand, the effort expended is well worth it as this will give you some suggestion of the services and the fees charged by these brokers.

Some of the major things that you ought to look out for are:

confirm that the broker is listed or regulated by an independent agency
Check out their customer service- professional, quick..
The online trading platform
Sort of Account offered
Broker’s Policies

Regulatory Agencies:

To avoid being swindled by the firm you trading through, you should look for brokers or firms which are registered and regulated by independent regulatory agencies. In the US, you can get more information about this issue from the National Futures Association website at: www.nfa.futures.org/basicnet/.

Customer Service:

You must ensure that your broker is able to provide proper support as well. This prerequisite is crucial as your capital is at stake here and a quick turnaround time is key. However, it is also vital to make sure that the support is of quality. It is pointless calling up a 24hours helpline to find a recording at the other end. One good tip is to call up the help-lines of all the brokers you have in mind and see their response time.

Online Trading Platform:

These days, the majority of the brokers permit you to make use of the internet to trade online. At the back of any trading platform is the transaction system. This must include:

Real time display of currency exchanges rates
Account review feature that shows all profits or loss, margin that is available and funds which are still locked in the open position

Always get a sense of the trading platform by testing out the demo system first before you commit to a real trading account.

Micro/Mini Accounts:

Prior to opening a full account, you might want to try out trading on a smaller scale. To do this you need to open a micro or mini account. These types of accounts lets you trade with smaller initial capital. Hence confirm if these brokers offer these sorts of accounts.

The Brokerage Policy:

Before signing up with any broker, ensure that you check their policies and features. This entails checking:

Tradable Currency Pairs
Transactional Costs
Margin Requirements
Minimum Trading Sizes
Rollover Charge
Margin Account Interest Rates
Trading Hours

Finding the right broker is a vital part of the process of trading. It necessitates some effort on your part to search out the right broker. Finally, never select the first broker who appears good to you. Keep searching and test out every demo account until you come across the right broker.

Read Day Trading Guide – Chapter 11: Costs of a direct access broker
Read Day Trading Guide – Chapter 12: Paper Trading Stocks
Read Day Trading Guide – Chapter 13: Conclusion

About the Author

FX Empire Editorial Boardauthor

Table of Contents

Intro

Intro