If you have some funds at your disposal and fancy trying your hand at forex investing, one of the first things you will need to do is to find a forex broker. The problem is of course that there are so many too choose from, so how to you decide which one is best for you?
First of all, you are going to have to do a little bit of research, but this will be time well spent because choosing the right broker can make a massive difference, especially for a novice investor.
One of the things you will want to look at is whether the broker is regulated and if so, by which agency. Because forex is one of the most unregulated of all markets, there are all sorts of sharks and cowboys out there who would be only too willing to set up an account for you and take all your money, so you can avoid them by going with a broker who is registered as an FCM (Futures Commission Merchant) with the CFTC (Commodity Futures Trading Commission) and the NFA (National Futures Association). That way, at least you know you are protected.
Another thing you will want to take a look at is the customer service level offered by the broker. Forex is a 24-hour market, so if you decide you want to trade in the middle of the night, there is nothing stopping you, as long as your broker has a 24-hour hotline.
As for the actual mechanics of trading, do you want to be able to enter your orders and see your trades online? If so, you will need to go with a broker who offers an online service or an Internet portal for managing your trading activity.
Finally, take a look at things like commissions and fees, minimum account balance, which currency pairs are offered by the broker, any minimum trade size, the ability to send and maintain stop orders, etc.
Once you have done this research, you should be in a much better position to choose a forex broker.
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