You have probably heard about the Forex and Forex brokers but don’t know what they stand for exactly. Forex is one the most liquid and most profitable markets in the world. It became the first investment choice of many common people today. Therefore, it’s not only reserved for the initiated financial experts, big banks, and government institutions.
Forex brokers are the companies that serve as an intermediary between you as a trader and the financial markets and liquidity providers, i.e., interbank network. When it comes to currency prices, you usually get one from your Forex broker, and that price is based on the offer from multiple banking lines.
How Forex brokers make money?
Forex brokers make their money from the spread, meaning the difference between the bid and ask price. And also, from the additional fees such as access to a particular trading instrument, monthly fees for accessing the trading software features, etc.
Due to the increasing competition on the market, many players must cancel as many fees as possible to attract more clients. There are also some brokers with their own trading operations. This practice can sometimes harm the interest of the clients putting the broker in a counterparty position. Hence the need for the regulation that curtailed this tricky situation.
Forex brokers’ regulations
Every jurisdiction has its financial authority in charge of Forex broker regulations. These are monitoring the market to make sure the companies are operating according to the best business practices. If the brokerage firm trespasses the regulation and tries to operate in a grey zone of a business, the regulatory body puts it on the blacklist.
Before you choose the broker for your trades, your primary task should be to check if the broker is regulated and shows the business transparency. The starting point in your research of the best brokers should be reading the broker review since it provides a clear overview of the company.
The importance of trading platform
Every good broker needs to have a reliable trading platform with no downturns. A trading platform is simply a software system specially designed for computers or other devices that allows users to trade in financial markets via the Internet.
By using a trading platform, investors can buy and sell the financial instruments of their choice offered by the broker in real-time. That’s why these platforms must operate efficiently, quickly, and smoothly and have an interface that provides an intuitive user experience.
A good trading platform has a range of analytical tools. These include technical analysis, chart drawing tools, studies, and statistics, or simply access to the latest and most important market news. Some trading platforms are created by the brokers, giving users the ability to implement their own solutions and strategies using API (Application Programming Interface).
The best broker is committed to building a lasting relationship with its clients by providing personalized solutions. It’s best done through a trading platform. Therefore, a trading platform should be functional, transparent, and easy to use for both beginners and experienced users. The interface should be user-friendly and intuitive.
Broker’s Customer Service Language as a crucial factor
When choosing the Forex broker, it is important to consider the language used by customer service. Sometimes, although they have a website in a particular language, some brokers do not offer customer service in that language. It’s a significant problem, as the lack of proper communication can lead to some misunderstandings. It is important that you feel comfortable in contact with your broker and that you can communicate your queries effectively. That’s why the language of customer service is so important.