Don't Lose your money in Forex Trading -
Forex Brokers

Dated: 2016-11-12

Commissions are not charged by most of the Forex brokers. They earn revenue by way of dealings through buying and selling, holding currencies, selling them, rollover fees. The amount the broker gets is really huge. Hence, there is no need for a commission.

Let us not feel happy over the fact that these brokers don’t charge commissions. They are definitely not doing charity. They earn their revenue by way of buying and selling currency. They sell your currency at a price and purchase it back at a low price. This is how they earn their spread or difference.

Let us now understand what a spread is?

Pip is the smallest increment in terms of money. It is 1/100th of a percent. The fourth place from the decimal point is the pip. It is also referred to as the basis point.

Forex brokers earn their money in the form of pips. The more the number of pips the greater is the spread. There are two types of spreads, a same spread and a variable spread. A variable spread may appear to be a very small amount in the market. When there are fluctuations in the Forex trading, the variable spread is low.

You can connect with the Forex brokers through large banks, investment companies and firms. They are regulated on the basis of the Directives issued by the Commodities Trading Commission. They are also governed by the directives of Futures Commission merchant. The Internet has increased accessibility to so many new traders and investors. Even though these small investors may not have the capital, they are still ready to do business. There are chances of success as well.

Expectations from Forex Brokers:

Once you are in touch with the Forex brokers, they need to be available round the clock for any queries. The Forex markets work 24 hours because of the time zone differences. In case it is midnight in one part of the hemisphere, you could still do business, because it is business hour in some other part of the hemisphere where the Forex broker has an office.

In case you need to leave urgently, you could always depend on your broker who is reliable by communicating on the phone. Please give clear instructions to your broker that you would also close certain positions on the phone, in case the internet is down or there is a problem with your PC.

It is advised that you conduct background checks about your forex broker. In case someone is able to vouch for the broker, it would be definitely good. You can be assured and do business with this guy. The Forex broker should also be transparent in his dealings. He needs to keep you posted about his company’s financial condition, and also be able to support it with proper documents.