What exactly should you look for in a good or safe forex broker? This may be one of the most asked questions among new and even expert forex traders. You can find a lot of credible sites offering exceptional information on the top brokers around the world. Despite having a lot of information and actual data available, most forex traders still lose a lot of funds from unscrupulous brokers who are out to make a quick buck. But are US or UK brokers the safest ones? In answering this question, a number of aspects have to be explored. These include
- Customer service
Are US or UK brokers really the safest?
There is a prevailing view that only companies from the US and the UK are the safest ones in the market. While this may be an overstatement, it certainly arises from a number of cold hard facts. One of the primary factors that lead people to have such notions is due to the regulatory bodies and structures in these two countries.
For brokers that conduct their business in the UK, the regulatory framework is rather simple. Anyone with a license from the Financial Conduct Authority or other European regulators is free to sign up traders in all EU countries. If the FCA approves your forex brokerage license, for example, you can easily get clients from France, Netherlands or even Germany among other European countries. Such a forex broker will, however, not be able to accept US traders as this certification is not accepted in the US. Also, FCA works to enlarge it’s regulation field in the country, which will definitely affect Forex Industry.
This is also a critical consideration for anyone who has been trading the forex markets. After all, no one wants to lose their hard earned money to some crooked forex broker. It is important to weigh critical factors such as how many years a company has been in operation as this will reveal how safe they may be. Have they survived any unforgiving bear markets? Or have they lost extremely large clients and survived the ordeal? These are some of the factors that tell you the true nature of a forex brokerage firm. You should also check out the deposit guarantee that they have and whether this guarantee is held in a separate bank account. Regardless of your trading skills, your profitability and long-time survival will ultimately depend on the safety of your broker.
You have already set up an account with your favorite forex broker and are looking to make some profitable trades. But alas! You broker charges a high commission or fees that you probably had no idea about. You are probably not the first to encounter such a situation. Many brokers will wow you with offers, bonuses, discounts and even promises of nil fees, but they must make some profits, right? Be wary of forex brokers who claim that they charge any fees. A significant number of these brokers tend to have high spreads, trading or even inactivity fees. Be sure you understand the charging rate and structure that your Forex broker uses.
Most forex brokers have trading platforms which allow you to place trades anywhere around the world. While this may be a crucial benefit, it can be detrimental if your forex broker does not have a great support service. Is your platform hanging and you can’t get through to your broker? You just lost funds. Do you have any grievances that you need to address? The availability and assistance of your broker will simplify this process.
Selecting a perfect forex broker to suit your needs will thus save you a lot of trouble. US and UK forex brokers are among the safest due to tight regulations, great customer service, and security.