best tips when choosing an online forex broker: PFR release to members trading forex markets

June 20, 2010 - PRLog -- Forex trading is relatively new to a lot of people especially those that have come from a background of stocks, share trading.  PFR as its known or Proforexroom go to: http://www.proforexroom.com said today that there are a number of tips one can use when starting out in forex trading or choosing the right Currency trading broker.  Not all online brokers are the same

While choosing the broker, following points have to be considered:

1 - Reputation: The reputation of the broker is important in forex trade. Their track record should be good. They must be transparent in their dealings.  Be aware that some brokers have dealing desks, some have straight through processing while others dont have STP.  A dealing desk may mean that the broker is trading against you which is not in your favour.  For a check of others experiences with brokers check http://www.forexpeacearmy.com

2 - Regulations: The brokers should adhere to the rules and regulations of the country in which they are carrying their operations. They must be regulated and made accountable to regulatory authority.  For Australians check ASIC http://www.asic.gov.au in England check the FSA http://www.fsa.gov.uk/

3 - Speedy execution of the orders: A good broker must be quick in executing the orders after the "Sell" or "Buy" option is selected.  Some brokers have a high latency and its important to check the speed at which transactions are made.  The writer has been caught on a number of occasions waiting as much as half a minute for online orders to settle an therefore what was a profitable transaction resulted in a loss.

4 - Difference in PIP: The professional broker charges the difference of PIP as his commission. There are some brokers who offer variable PIP spread. It is better to opt for low or fixed PIP spread.  Remember; not all brokers are the same and some brokers offer FIXED spread and VARIABLE spread ie. ECN broker spread.  If you want to check the spread changes and what other brokers spreads are check the following site: http://www.mt4i.com/spread/symbol.aspx

5 - Size of the trading account: For catering small retail traders, the brokers offer two types of accounts- Standard account and the Mini account. The mini account deals with 1/10th of the size of the standard account.  Some brokers allow trades starting from 0.01 lots, nano accounts and others state the minimum size per transaction is 0.1.  http://www.oanda.com trade in units and dont have a fixed lot sizing policy in place like other brokers.

6 - Leverages and Margins: You should obtain all the information regarding th
e calculations of the margins and leverages. Never opt for higher leverage. It can work easily against you no matter how attractive leverage seems.  Some brokers such as Oanda offer 1:1 to 1:50 maximum whilst other brokers will offer up to 1:500 leverage.  Thats $500,000 of contract value amount for ever $1,000.00 equivalent.  If your new to the market just dont do it! get the trading experience first so you can work out risk and reward profiling relative to the size of margin (cash) available in your account.

7 - Rollover: These are levied by the brokers when they move their position to the next trading day.

8 - Trading platform: A good trading platform should provide all the expertise to cater the experts and the novices.  A number of brokers offer Metatrader.  Not all metatrader platforms perform the same, some are slower than others, others have requotes constantly etc.  remember not to have too many charts running at once if you are trading Expert Advisors EAs on the MT platform as this will cause data errors which you can note in the journal.  

9 - Technical support: Since the forex trading goes round the clock, the broker should provide the necessary support, whenever required.  Believe me, some brokers are only contactable by online chat and cannot phone in when theres a live trade on.  When the system is down, and live trades are in play, the last thing you want is not being able to connect.

10 - Other value additions: The brokers should make available other value added services like technical tools, market analysis etc.  Generally stock standard services are available in the packages. Charts and indicators tend to be very similar accross broker to broker platforms ie. candlestick charts, bar charts and line charts and similar indicators on offer eg. stochastic, rsi indicator, macd, moving average lines, rate of change, momentum oscillators, adx,  etc.

Perhaps another avenue for consideration is a live Forex trading room. PFR or Proforexroom http://www.proforexroom.com operate a live trading room during the European London trading session.  "Basically we are open during the European session daytime with the day beginning around 8am and ending around 6pm".  We trade a number of pairs throughout the day.  "our results have been amazing.. we have achieved over 1,000 pips profit each month since the beginning of the year, you can have a look at our website and track the profit performance of our trades."

Would you like to have a trial of the Live trading room? simply go to the website http://www.proforexroom.com and register for a free 14 day trial.

--- sucessful trading
D

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Whether your new to currency trading or a seasoned trader, proforexroom is designed to either teach or follow alongside the traders in the room. Proforexroom is a live currency trading room each day during the European fx session in English & Italian.