Online Forex Brokers

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An online Forex broker is a firm, such as Avafx, Etoro, Easy-Forex which acts as medium for matching buyers and sellers of foreign exchange currency or Forex as it is often nicknamed. They usually do this for a nominal fee or commission. Online brokers are regularly employed to monitor and maintain the 24-hour Foreign exchange market place and assist in providing liquidity in the market. A Forex trader will have to make use of broker in order to engage in trading activities on the Forex market.

With the rapid growth of the retail Forex trading market (the ordinary forex trading world for you and me), one can see more and more online Forex brokers appearing daily trying to grab some profits out of this fast growing market. It is often difficult to choose a Forex broker with all the choice out there

How does a trader choose between all these brokers?

1.) Size: The first thing a trader must consider when choosing an online Forex broker is the size of the organization. Usually larger institutions have economies of scale and can offer competitive pricing and offer traders better deals

2.) Reputation: Do some homework before you choose a broker, reputation is vitally important and ic markets  you can establish an online Forex brokers reputation is try finding a trader who actually uses them, see support forums rather than searching on Google, as Google results will probably bring up many affiliate sites promoting the broker, rather than telling you the real facts

3.) Trading Products: Brokers who offer a wide range of trading products are better, for example: If there is instability in one currency pair it is advisable to trade a different currency until the stability returns, but if your broker doesn't offer a wide range of currency pairs or trading products then this would not be possible.

4.) The actual trading platforms: Trading off the charts is very popular for modern online Forex brokers, it is important to have a broker that offers you advance charts, especially if you are going to be performing technical analysis before conducting a trade. Visit the various brokers Website and register for a demo account with them to see if you like the platform before using that particular broker. Do not be rushed into choosing a broker, take your time and do it thoroughly as it will be worth the research.

5.) Commissions: Most online brokers make money on the spreads. The spreads are the difference in the buying price and selling price of a currency pair. They are usually coined the name pips (1 pip = 1 point currency pair) most brokers offer around 3/4 pips on major currency pairs such as USD/JPY, USD/EUR or EUR/GBP. Online Forex brokers will list what the spread is on their Website. The lower the spread the better.

6.) Forex deposit bonuses are free money: Many people don't usually see the benefit these Forex deposit can actually do to your account. These days with online Forex brokers being so very competitive they offer very lucrative deposit bonuses, sometimes even up to 100% of your original deposit. This essentially means that you deposit $100 and you get another $100 added to your account to trade. Just by doing that you have made 100% profit on you investment, not a bad investment.