Which is the best brokerage firm for forex trading? and why?
Question:
Answer:
When looking for a brokerage firm to trade forex, you look at 3 things: commissions, service and execution. Regardless what any dealer or broker says, the spread charged on your currency trade is a commission, period. Most firms charge around 2-3 pips a trade, although your trading volume may make you eligible for a discount. Other firms will charge an additional commission, usually stated in $$/ round-turn.
Service entails the reasearch, education, technical assistance and trading. It's important to consider the tools to which a firm gives you access to make your trades, since it's these tools that will allow you to make your trading decisions. Most products offered by firms include research and predictions, but understand that this is only one part of your investment. Once you're in a trade, it's essential to know how to manage your risk, so look for firms that stress money management and risk management in addition to predictive systems.
Execution is the heart of currency trading. Firms operate thru dealers since a centralized exchange doesn't exist. It's important to know that your brokerage is operating thru a dealing desk, where the clearing firm may be taking positions opposite you in the market. This can make it difficult for you to profit since it is they that determine when you can enter or exit a trade. It's also important that you track slippage, where your broker or even the dealer are consistently offering a price that is higher or lower than the published bid or ask.
I don't make a particular recommendation since every trader has a their own preference in terms of the commissions, service and execution they demand. If you're searching for a brokerage, be aware of the rules of the game first, so that you'll have a better understanding when negotiating to open an account.
To receive a free book on the essentials of forex trading, e-mail me at info@liverpoolgroup.com.
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Personally I would suggest an investment club ...for one the club does not charge any fees as it is formed bu like minded people to invest in the same thing Two depending on your risk level you can find a club where they invest in high risk or one that trades at a safer level. I invest in the forex with other investors and on a average we make 5.3% per month. by any standard that is a good return. When we make trades, or goal is to make at least a 2 pip profit and as much as 6 but we do not push any higher as then you are putting your money at high risk. If you would like more information write to me at billone44@hotmail.com
Investment clubs are the way to go it is the only place where you do not have to pay anyone to make money and you can learn thereby when you feel like you want to try yourself you can
I usually suggest Interbank FX to my clients because we have negotiated institutional interest rate which are not available to regular retail clients.
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