How do foreign exchange brokers choose novices?
You must conduct a rigorous review of foreign exchange brokers to ensure that they are competent, trustworthy and in your best interests. Here are some important questions you need to keep in mind when evaluating brokers:
Regulatory qualification is the core to ensure the safety of funds. You should think like a detective and check the regulatory records of your brokers, as well as the industry reviews of the media and the corresponding supporting materials.
If the broker accepts the restriction of the local regulatory authorities, it means that the broker takes the business seriously and strives to comply with the regulatory laws and requirements. If you do something wrong, you will be punished by the regulators.
When looking at the past experience of brokers, what are the real things to be vigilant about? We need to focus on the litigation and fine notice of regulatory websites, and check the complaints related to the transfer of customer funds, sliding point fraud or false publicity. We should focus on those serious disputes that lead to significant arbitration.
On the other hand, some technical violations such as the failure to establish information records in time are common, and such incidents are not harmful and can be tolerated. In any case, there are more than 100 foreign exchange brokers in the world. It's better to have a look at more than three.
After installing the analog trading platform, double-click the desktop icon, input the analog account number and password, wait a few seconds, and a few numbers will pop up. This is the currency pair. You need to make some lists to see the transaction speed. You can also see whether the platform is stable when the data comes out. This is a time of mutual understanding.
4. Is the spread fixed or floating? If the difference is large, it is usually fixed. Although the floating spread is low, it will expand when the transaction is sparse.
5. What is the spread of currency pairs? This is the core of the judgment platform. Point difference is too large, in frequent short-term transactions, it means that your transaction costs are too much.
Some customers have opened real trading accounts with brokers. You only need to visit common foreign exchange forums and chat groups to get feedback. When talking with these customers, remember to ask them in detail. How often do brokers contact them? Are brokers fast in and out of money? How often do they launch foreign exchange education programs? Has the quality of customer service ever surprised or disappointed them? Does the platform perform well during the data release period? Is the Chinese service complete?
If you can bypass foreign exchange brokers and get indirect evaluation from customers, you can often get more useful information. It should be reminded that some partners who have direct interests with foreign exchange brokers, such as IB, are also lurking in the forum. You need to discriminate and learn to listen to both, then you can get an objective answer.
The stronger the assets of a broker, the more competitive its business is. Take Fuhui as an example. It was listed on the New York Stock Exchange at the end of 2010. Through the disclosure of IPO financial data and the performance of Fuhui's share price, we know that its market value is about US $1 billion. HuiFu also has a strong market share, especially in Asia.
Among the events involving foreign exchange investment fraud, there is a prominent warning signal, that is, the lack of full disclosure of financial information of brokers. At present, the United States has done a good job in the information disclosure of brokers. In addition to publishing the assets of foreign exchange brokers in the United States every month, it also forces brokers to disclose the profit and loss ratio of customers, trading volume and other information. This kind of transparent financial disclosure mechanism makes foreign exchange brokers who operate healthily in the United States enjoy a reputation.
The financial information of listed brokers is relatively clear, and they usually occupy a strong market share. So there is a lazy evaluation method, that is to directly select a listed broker. However, this does not guarantee that you can get back all the principal when the broker goes bankrupt. The bankruptcy case of American Ruifu group in 2006 taught traders a profound lesson.
Foreign exchange traders sometimes encounter difficult problems, such as frequent offline platform, slow transaction, etc. You need to contact the customer service staff of the broker. If you think they are avoiding problems or putting a positive label on everything, you should be alert. This may mean that they will not have enough professional skills to deal with or cope with difficult decisions.
As long as a trader signs a formal agreement with a broker, it means accepting rights and obligations. There are two kinds of protocol, one is electronic text protocol, the other is paper protocol, but the former is in the majority.
Keep in mind that some brokers' agreements may lag behind. For example, the United States has just issued a new policy to reduce the leverage to 50:1, but the agreement downloaded from the website may not have time to update. Therefore, you also need to download the broker's simulation platform,
If the broker breaches the contract, it can directly complain to the corresponding department. Take, for example, the NFA's online complaint system. Don't underestimate this agreement. It is with it that you have the confidence to rely on the regulatory authorities.
The most convenient service is undoubtedly one-stop. Just choose a foreign exchange broker, you can open an account for trading, understand market information, consult focus data, learn foreign exchange comments, and learn foreign exchange knowledge. If possible, you can directly download the intelligent trading system of the trading platform, and talk about all kinds of transactions in the forum of foreign exchange brokers.
This means that your foreign exchange broker must be strong enough to recruit professionals or have a strong partnership. If your foreign exchange broker pays attention to user experience, it should provide various solutions related to actual combat, and even arrange experts to let you consult specific trading strategies.
From the operation time, asset strength, the number of overseas offices, product types, the number of employees, customer service quality, website traffic and other company indicators, to judge the strength of brokers.
Broker a was founded in 2002. According to the monthly assets statement released by CFTC, its US assets are more than 60 million US dollars. It has branches in the UK, Hong Kong, Japan, Dubai and other countries, providing dozens of trading varieties such as foreign exchange and CFD. It has nearly 500 employees and provides 7-day 24-hour customer service. Alexa, a foreign exchange novice website, ranks about 10000. It has just won the industry authority award in the new year.
Broker B was founded in 2009, and there is no way to know the scale of assets. The company is only located in a certain country in Africa, with only telephone and email contact information. The number of employees is unknown. There are only a dozen currency pairs in the platform, and the website ranks behind hundreds of thousands.
In short, the choice of foreign exchange brokers is a delicate art. This is similar to choosing TV in the home appliance market. In the face of many sales staff's comments, you have to have a steelyard in your heart and know what you need most. As long as we shop around, practice simulation first and listen to more objective evaluation, we can hope to select a preferred foreign exchange broker.
A lesson from the retail foreign exchange industry is that capital security is very important. What worries people is that some companies providing account opening are not real foreign exchange brokers, but fraudulent companies, which neither accept the constraints of government departments nor the management of industry self-discipline organizations.
With the merger of the industry, a group of truly powerful foreign exchange brokers stand out and improve their image and products and services. This greatly squeezed the living space of those bad companies. These powerful brokers can live longer and must be subject to financial regulation. In particular, listed brokers need to disclose their financial status to the public.
Having a trading account with a regular foreign exchange broker will be a healthy way of trading - even more so if the capital can grow - and you can sleep at night without worrying about not getting the capital back.
[disclaimer] the publication of this article by finance managers for the purpose of transmitting more information does not mean that they agree with their views or confirm their descriptions. The content of this article is for reference only, and does not constitute an investment proposal. Investors operate on this basis at their own risk