Are you new to Forex trading and looking for the best Forex brokers for beginners to get started with your Forex ambitions? If so, you needn’t worry. We’ll walk you down to successful Forex trading.
While there are many Forex brokers out there, not all are beginner-friendly. Some may have a
high minimum investment amount that only advanced traders can afford to stake such amounts.
But is it wrong to start with advanced Forex trader brokers? You may ask.
Like it is in any profession and job group, the level and amount you can trade with successfully largely
depends on the level of knowledge you have in the world of currency trade.
Therefore, as a beginner, it’s imperative to start with the best Forex broker for beginners and
advance with time as your mastery and understanding of the trade elevates.
After deciding on the currency for your trade, trading style, and a trading plan, the next critical step
involves choosing the best Forex broker that matches your trading needs.
What Is a Forex Broker? Here’s What You Should Know Getting Started
Are you wondering what a Forex broker is? Perhaps you’ve heard and read about forex brokers
but don’t have a solid idea of what is exactly.
Well, let’s delve deep into it!
A Forex broker refers to a service company that offers forex traders a platform to buy and sell foreign currencies. Sometimes, a forex broker is always referred to as a currency trading broker or retail forex broker.
Essentially, trades in the forex market take place between a pair of two different currencies.
The exchange market is a 24-hour global market that features a continuous shift in currencies’ value.
Without a forex broker, forex trade would be overly complex and expensive in terms of processes and the overall cost involved.
What are the Roles of a Forex Broker?
Well, now that you understand who a forex broker is, the next critical step is to understand their roles in the Forex trade.
Basically, most forex trade takes place between a pair of currencies from the G10 countries. The G10 nations and their currencies include:
- S Dollar (USD)
- Euro (EUR)
- Sterling/ Great British Pound (GBP)
- The Japanese Yen (JPY)
- Australian Dollar (AUD)
- The New Zealand Dollar (NZD)
- The Canadian Dollar (CAD)
- The Swiss Franc (CHF)
While some brokers allow traders to use the above-listed currencies, most brokers allow their
clients to trade in other types of currencies, even the emerging currencies.
Therefore, it would be important to check the currency options that your broker allows before signing up for the platform.
When getting started, you’ll open an account with your preferred broker, buy a currency pair
to open a trade, and then close your trade by selling the already bought currency pair.
After closing a trade, your trade outcome can either be a profit or loss. For instance, when you
buy a currency pair after its prices flopped and closed the trade at peak prices, you’ll make a profit.
Similarly, closing a trade at the point prices are lower than you bought the currency pair, you’re most
likely to take losses. But since you’re focusing on a long-term goal, losses and profits are always randomly distributed.
With a valuable trading strategy, plan, and the best forex broker, your chances of ending up
with a significant profit at the bottom line are endless.
Getting Started with the Best Forex Broker for Beginners
Now that you have mastered the Forex market’s essential aspects, you have the drive and focus
on directing your energy to succeed; what next?
Choosing the best retail forex broker for your venture!
But, guess what? Forex is likely to become your favorite playground!
However, for a novice like you, knowing the right forex broker for your Forex trading venture
could be a bit tricky if not overwhelming. But you don’t need to worry.
We’ll help you select the best Forex brokers for beginners to avoid the possible tricks and frauds in forex trading.
This forex guide is a kind of currency trading for dummies that will simplify and
underline all the necessary steps to take. If you follow the steps, you won’t be having a
headache choosing a reliable broker.
Here are some important and frequently asked questions that many newbies like yourself may ask.
The answers will surely be useful in narrowing down your choice among forex brokers designed for beginners.
You’re one step away from becoming a successful trader, but make sure to select a
broker who will offer reliable services based on your needs.
The first thing to do is to select a trusted forex broker for beginners. But an inexperienced trader
may ask: how do I check my forex broker?
5 Proven Tips for Picking Best Forex Brokers for Beginners
If you’re a trader committed to doing a
Successful business through the foreign exchange market, many forex brokers are looking to
winning you to their online trading platform.
If you happen to visit any popular financial news site, the chances are high that you’ll be
bombarded with many adverts from forex brokers looking to add more traders to their platform.
But how can you cut through the noise and choose the best forex broker for your business
without getting lost in the clutter?
Well, below are some of the critical things to look at when choosing the best forex broker for your
foreign exchange trading venture.
Ready to get started?
Let’s explore some of the essential things you should look for before settling down on a choice.
- Regulatory Compliance History
Before deciding to trade on any broker platform, checking on their reputation is of utmost priority.
Reputation helps you to know what your trading experience on their platform would look like.
Reputable and trustworthy forex brokers are registered by recognized foreign exchange trade
bodies such as National Futures Association, also known as NFA.
The National Futures Association is a reputable organization for the futures industry.
Also, the broker should be a member of the Commodity Futures Trading Commission, commonly
abbreviated as (CFTC). This organization regulated the commodity options and futures markets across the USA.
Apart from the US, each country has its independent and regulatory bodies that any reputable broker
in those countries should be registered with.
A compliant and duly regulated broker ensures the safety of clients’ deposits, eliminating the
potential security issues regarding traders’ deposits.
If you’re wondering how you could separate duly regulated platforms from those that are not,
it’s pretty simple. Just navigate their website and check on the “About Us” section and find out if
the broker has provided their NFA and CFTC number.
A duly registered broker will always display their relevant registration numbers and other
regulatory certificates to show their compliance and commitment to their clients’ deposits’ safety.
Therefore, be wary of a broker with no registration or license numbers displayed on their website.
- Features of the accounts offered by the broker
Each forex broker offers different account features on their platform.
However, these four essential features can actually be a deal-breaker.
Let’s delve deep into the four essential aspects you should look at before making up your
mind to trade on the broker platform.
- Margin and leverage
With access to the leverage provided by your broker, you can hold higher positions with a small amount of stake.
For instance, with $1,000, a trader can use leverage like 50:1 to hold a position valued at $50,000.
However, the ratio varies depending on the broker. As such, some may offer lower ratios, others may offer as much as 200:1.
Leverage can offer a great boost to traders’ profits in multiples.
But, it can also damage the trader’s account by magnifying losses if the trader takes a loss on orders placed on leverage.
Therefore, you should master a profitable discipline and avoid overusing leverage.
- Commissions & Spreads
This is yet another critical aspect that you should consider before choosing a forex broker account.
Brokers that take commission will always charge a certain percentage based on the spread.
on a forex pair. Spread can either be fixed or variable based on the volatility of the forex market.
Some brokers may not charge commission. Instead, they make their earnings from a wider spread.
As the spread widens, the more you’re likely to make losses.
Typically, popularly traded currency pairs such as GBP/USD and EUR/USD always have a tighter spread than other unpopular pairs.
Therefore, it’s imperative to know how your broker makes their profits and shop around wisely.
- Deposits policies
When getting started with the forex trade, the best forex broker for beginners allows a low initial deposit amount.
Some brokers allow a minimum deposit of $50 and give great leverage for traders to hold high-value positions. With leverage, you get incredibly high buying power than your initial minimum deposit.
Typically, many forex brokers offer diverse accounts, such as micro, mini, and standard forex
trading accounts with different minimum deposit requirements to fit different traders’ needs.
Besides the minimum initial deposits, the ease of making deposits and money withdrawal
from your forex account should be of significant consideration.
Since account funding and withdrawal policies vary from one broker to another, a broker may allow you to fund your online account via PayPal, credit card, ACH payments, bank transfer, wire transfer, bank check, personal check, or business check.
Forex brokers may charge a fee on account deposits, or withdrawals, or both.
Therefore, you should be fully aware of what your broker’s charges look like.
For beginner traders, it’s imperative to go for brokers charging low fees while offering great opportunities for successful trading.
- The choice of currency pairs offered by the broker
Always go for the broker that offers a great selection of currency pairs that falls within your interest.
While there is a wide range of currency pairs, major pairs such as EUR/USD, GBP/USD, USD/JPY, and USD/CHF are
trade options with the greatest liquidity due to the massive attention.
- The Quality of Customer Services offered
Getting stuck on the forex trading platform sucks! Therefore, as a beginner forex trader, opting for a broker platform offering excellent customer support is essential for successful forex trading.
Regardless of better deals offered by the broker, getting the much-needed assistance is critical for your business.
Since forex trade takes place 24 hours a day, a good broker should have 24-7 customer care to assist you anytime,
whenever you need it.
To find out the degree of responsiveness of a broker’s customer support team, you can make a quick call
or try a quick live chat. Doing so will give you an idea of how fast they respond to their client’s inquiries.
- Trading Platform
The online forex trading platform is your typical portal to access the forex trading markets.
Therefore, you should ensure the broker platform has all the features you need for an effortless trading experience.
Ideally, a standard platform should have software complete with the fundamental and technical
analysis tool you need for a successful trade. Also, ensure the platform offers an easy way to enter and exit trades.
A user-friendly platform will always have a indicated “Buy and “Sell” button, with others even
including a “Panic” button to help you close all the open positions in your account.
On the contrary, a poorly designed platform user interface can lead to regrettable order entry mistakes.
You can also consider other essential aspects such as order entry types, customization options, strategy
builders, automated trading options, trading alerts, and backtesting features.
Some best forex brokers for beginners allow potential traders to open a demo account on their
platform to master how things work in real-time before opening a real account and funding it.
How do find out if the broker is registered and reliable?
When you open your forex account, you don’t want your funds to be unsafe or stolen.
The smartest thing to do is to check out if your broker is registered with NFA (Natural Futures Association) or CFTC (Commodity Futures Trading Commission) if it is located in the US or FSA (Financial Service Authority) if it is located in the UK.
For the EU regulatory bodies that control EU Forex markets, check out this site: www.tradersasset.com/forex/brokers/european-forex-brokers.
You may also check the broker reviews and forex broker list of customers.
Still, if it isn’t registered in any of these agencies regulated by specific state authorities, you better skip it.
These agencies provide a license that enables a broker to be listed on the market. Keep in mind that a
reliable broker must have a license!
Another thing, a good forex broker must have a good reputation, so it’s also good to look for the opinion on a company’s public image.
Please don’t be lazy to check out the charts of relevant trading platforms created either by real customers or
by experts who share their experience on the official trading websites. Be one step ahead of everyone else!
What is the minimum deposit?
Thankfully, the forex market doesn’t necessarily require a considerable minimum amount to start forex trading.
Since minimum forex deposit allows flexibility, you can start trading with significantly less capital
than required for day trading stocks.
If you don’t have $10 000, it’s not the end of the world! Most brokers operate multiple account types,
so the traders can choose the category they want to be in (minimum accounts, VIP accounts, etc.).
How Much Money do I Need to Start Trading Forex?
The amount of money you need to start trading is determined by your goals.
It’s not the same if you simply want to increase your account or want a regular income.
With the minimum opening balance, the trick is that people are impatient to let their account grow,
and the risk too much on each trade, but eventually, they lose everything!
Don’t be that impatient and greedy person!
Before trading forex, you need to check out what forex fees are to open a trading account. Some brokers advertise forex commission-free trading but still make money from trades through a bid/ask spread.
So before making any trade, make sure how all the parties involved are being compensated.
Another thing, before choosing a forex broker, you should begin trading with no money – open a
demo trading or a practice account. If bad things must happen, let them happen in a demo world!
Best Forex Brokers for Beginners have demo accounts
On the road to forex stardom, you must practice your forex skills to become a professional trader.
Download a free forex demo account and start earning virtual money! You’ll find a demo account on
every reliable broker’s homepage. You’ll see that an interface is very easy to use.
Test different trading strategies for an unlimited period of time, and find the one that suits your needs.
The best demo account provides you with the same conditions as live accounts but without risks of losing money.
This is a safe environment for the novices like yourself to take their first steps in the forex market.
Besides learning basic aspects of forex, you’ll get the opportunity to become a strategy pro and a good evaluator of broker services using charts, technical analysis indicators, and so on.
When you think you’re ready, having mastered all the essential trading strategies, it’s time to open a free forex trading account with real money.
This live account gives you more than a demo, even with minimum funds, because you’ll start sensing the relationship between the profit and currency movements.
Online Educational Forex Courses for Beginners
If you want to improve your knowledge further, enter an online forex trading course for beginners.
A quality forex webinar will explain the forex market’s basic concepts and the useful fundamental
analysis tools to help you understand how this market operates.
For example, Saxo Bank offers top-quality webinars.
Their free forex trading guides will help you go deep into the forex matter and instruct you on how to avoid investment loss.
The more you know, the less you risk! There’s an endless amount of information online waiting to be explored.
To find the best forex trading course, educational tutorials and articles, seminars, and more…
Forex benefits for new users
Besides demo accounts, most brokers offer welcome benefits for newbies, such as a welcome bonus or no deposit bonus.
All you have to do is sign up on the broker’s homepage to earn your welcome gift.
For brokers, it’s profitable to draw the attention of new traders.
Anyone who hasn’t been registered can receive free forex dollars.
These deposit bonuses are given only for trade, but you can’t withdraw them unless you
fulfill certain conditions of a trade turnover.
The Best Forex Trading Platforms
If you are a beginner in forex trade, the right broker means much more than a platform for trades.
It’s important for you to build an investing base.
The best forex broker for beginners USA / UK offers endless educational courses for
the newbies, fair commissions, and reasonable investment options, as well as strong customer service.
Here’s the list of the most reputable platforms, and you decide what the best forex broker for beginners like yourself is: