8 Effective Steps For Choosing The BEST Forex Broker In 2020

Forex trading has become a common and passive profession worldwide. As a result, many people are engaged in the foreign exchange market almost every day.

Therefore, many beginners in the forex market is facing a lot of while choosing a Forex broker confusion. And in the end, due to the lack of knowledge many times they are not choosing the appropriate Forex broker for themselves.

Here are 8 key factors when choosing a Forex brokerages

1. Regulation

The best thing is to start by looking at whether the broker you choose has a regulatory licensing and approval SA.

market regulation to investors to protect themselves against fraud or fraudulent activity by the broker.

They also provide supervision on brokers registered with them, ensuring fair conditions of trade and transparency, responsibility by the broker for all the problems between the client and the broker.

In South Africa, the dog market Financial Conduct Authority sector guard (FSCA) monitors and regulates the activities related to market financial institutions operating in the country.

International regulators such as major markets CAF UK, Australia ASIC, CySEC Cyprus - all do the same to protect the interests of investors by regulating the market.

Some brokers show their offshore regulations and registration of their clients under the rules, it's not good enough to ensure adequate protection of funds or good trading conditions. Forex no-deposit bonus is also including them.

In most cases, you will find information on the regulation of brokers on their page of a website, bottom of the page, or on their registration page. Always ask your broker for their FSP license number before investing.

Most regulators, including - FSCA have a general search where you can search by entering the name of a licensed broker or number FSP them.

There are about 100+ brokers regulated CAST that offers forex and CFD trading for retail traders in a regulated environment.

2. Investor protection

This is an important consideration as to ensure that your funds are deposited on the platform of the broker where he will be safe. In a bankruptcy or worse broker events similar scenario, the risk of an investor will be limited.

The amount of OFFERED protection is pre-defined and limited often.

For example in the US, the number of investor protection is up to $ 500,000, while for Europe in general 20 000 €. This protection is usually provided by the Investor Protection Fund managed by the state or independent insurance providers.

South Africa has no protection fund investors backed by the state at that time. But some FSCA regulated brokers can still offer some protection.

For example, HotForex (HF Markets SA Pty Ltd) are regulated by the FSCA has a liability insurance program for the protection of investors to limit € 5,000,000 in terms of risk of errors, omissions, negligence, fraud - which can cause financial loss to the broker. Brokers typically display this information in the "security fund" on their website.

Another important factor to check the safety of the funds is - if your broker has a separation of client funds of the company's operational needs. This limits the use of fund dealer customers deposited for working capital needs.

3. Trade and non-trade charges

Before opening an account with a broker, you should always check that the transaction fee charged by the broker, and if any service or hidden fees.

Most brokers make a profit by charging you a commission or fixed fee per transaction volume. This is called the spread.

Some dealers may charge lower margins, but they can charge other non-commercial such inactivity fees, fees on deposits and withdrawals, account maintenance fees, etc. making their higher overall cost.

Also, some brokers increase their high volatility deployment. Thus, analyzing the overall cost of different trading platforms and make sure to go with a broker that offers the lowest spreads and commissions lot on the instrument you want, without other hidden costs.