Question:
What is a Forex broker?
Forex Broker
A forex broker is a person who acts as an intermediate between the buyer and seller of monetary units. The forex broker is basically your go-to guy. The forex broker helps people stay connected for their buying/selling needs and helps prevent fraud or unethical trading practices. When a broker acts as a buyer/seller, they become a principal party (dealer). A brokerage firm is a company that behaves as a broker, for example FX Club can be considered a forex brokerage firm. Forex brokers can come from large commercial financial institutions. These forex brokers are highly regulated because of the legal commitments and regulated governance of financial institutions. The small forex brokerage firms are in greater demand from dealers and traders because they have more intimate contact and lower upfront investment minimums than the large financial institutions.
Since large financial institution forex brokers often require a $500,000 to $1 million dollar trade minimum, most people go with a private or smaller forex brokerage firm. However, it is important to note that forex brokers must be able to have a wide amount of leverage, and so they are usually tied to the larger financial institutions. You want to ensure that any forex broker you choose is registered with regulators. FX Club, for example, is a Futures Commission Merchant (FCM) which is registered with the National Futures Association, and therefore is regulated by Commodity Futures Trading Commission. It is very important that you check FCM before signing with a forex broker to ensure that they are registered, and therefore are accountable to behave in a legal and ethical manner. Furthermore, it is recommended that you research the forex broker to ensure they are licensed and examine the amount of time they have been a forex broker. Longevity in the forex broker industry shows that they are stable and reliable. It is highly recommended to find a forex broker that has longevity, stability, and is a member of the FCM. In this manner, you are protecting your investment.
Forex Frequently Asked Questions
How Do You Select a Currency Broker?
What Do You Need to Know Before Trading in Foreign Currency
Where Do You Find Forex Broker Reviews?
What Are Some of the Best Forex Brokers ?
What Are the Best Forex Brokers for Beginners?
How Do You Get a Practice Forex Trading Account?
What are Foreign Currency Exchange Rates?
How Do You Check Currency Rates Before Traveling?
What is the Conversion Between Dollars and Euros?
Why are the British Not Part of the Euro?
What Affects Currency Exchange Rates?
What is the Difference Between Spot Rates and Forward Rates?
How are Foreign Exchange Rates Determined?
What are the amounts of Forex broker commissions?
What are brokerage commissions from Forex spreads?
What is leverage in the foreign exchange market?
How does leverage minimize foreign exchange risk?
What are Foreign Exchange Markets Spreads On Major Currency Pairs?
What is the Forex minimum investment requirement?
How do I open a Forex live trading account?
What are foreign exchange market signals?
When should I enter or exit the foreign exchange market?
What are Forex trading signals?
What are the best Forex trade signals?
How does the Forex signal service work?
How do I read a Forex alert signal?
How do I understand Forex signals?
What types of Forex signal software is available?
What is the Foreign Exchange Currency Market (Forex)?
Who is the Forex Club Financial Company or FX Club?
How does global Forex trading work?
How does the Forex Fundamental Analysis work?
What do I need to know about Forex Currency Exchange?
Where Can You Find a Good Forex Demo?
Where Can You Find a Good Introduction to Currency Trading?
What Are the Risks of Trading in the Forex Market?
What Are Some Great Forex Trading Books?
What Do You Need To Know Before Day-Trading Forex?
What is Leveraged Forex Trading?
What are Financial Leverage Ratios?
Why is Forex So Heavily Leveraged?
What is the Definition of Financial Leverage?
What is a Financial Leverage Formula?
What is Meant by the Degree of Financial Leverage?
How Does Leverage Profit a Forex Investor?
How Do You Limit Your Risk When Trading Forex?
What are the Benefits of Forex Software?
Why is Online Forex Trading Better?
How Do You Get Mobile Forex Alerts?
Is There Such a Thing as Free Forex Trading?
What Are Some Recommended Forex Platforms?
What Are Some Recommended Forex Trading Systems?
What is the Oanda FXTrade Platform?
What is the FXSol GTS Trading Platform?
How Do You Enter a Forex Contest?
What Are the Characteristics of Successful Forex Traders?
How Do You Become a Forex Trader?
What are Forecasts for Foreign Exchange Traders?
Can You Trade Through a Managed Account?
How does Forex currency trade work?
What is forex technical analysis?
How does Forex chart analysis help currency trading decisions?
What is Forex currency charting?
How do I read Forex currency charts?
Where do I find free Forex charts?
What are the characteristics of foreign exchange charts?
What is a Forex trading session?
How does Forex trading session work?
What is free Forex? Is it really free?
What should I know about forex platforms?
What are the Forex trade platforms?
What is a forex trade strategy?
Where can I find more information on Forex trading sessions?
Where can I find Forex video training?
Where can I start learning foreign exchange training?
Where can I find Forex classes?
Where can I find currency trading courses?
What should I be learning in currency trading education?
What should I be asking during forex courses?
What resources are available to help with currency trading education?
