The first thing to keep in mind when starting your trading career is choosing your broker. This company will be the intermediary between you and all the financial markets. This will provide the access, the software and the instructions and mechanisms for you to be a successful trader. Sadly, not everything is rosy, and traders should be cautious when choosing a broker. In the beginning, many reasons can lead you to be a victim of fraud.
1. Consider the range of instruments available
Newbies, and due to advertising issues, usually start in the world of Forex, mainly because of the facilities that are offered. But what if you want to expand your portfolio? Jumping from one broker to another because the first one does not offer you a financial instrument is a total hassle. Therefore, get ahead of the facts and register with a broker that offers you a wide variety of instruments. Over time, you can trade instruments like CFDs, commodities, and even cryptocurrencies. You will have everything in one place and you will have greater ease.
2. Beware of operating costs
We can find two types of Brokers: market makers or ECNs (electronic communication networks, for its acronym in English). They use different financial models, and hence the difference in cost to operate. ECNs give you access to market prices in real-time and charge you a commission for each operation.A market maker, on the other hand, includes costs in spreads, which can vary slightly from the current market price. The spread is the difference between the two prices of an asset in the financial sector, on the one hand, the value of its purchase and on the other the value of its sale. Generally speaking, the lower the spread, the better for the trader user. In addition, there may be commissions for operations that are carried out at certain times, which is an important point for those who plan to dedicate themselves to long-term trading. These commissions are usually present in operations that are left open from one day to the next. It is important that you know these conditions, which should be easily accessible. Some brokers even offer cashback to loyal customers.
3. Pay attention to customer support and educational materials
The best brokers offer support and training resources. A good broker should allow users to contact their experts via email or live chat when necessary. Quick-response, easy-to-access customer support is a sign of trustworthiness. A quality broker does not leave its users adrift, it offers them guides and instructions. Keep in mind that a good broker offers a diverse collection of educational material. Users can access tutorials, articles, webinars, etc. This is important because it gives you the opportunity to acquire knowledge at your own pace and makes it easier for you to create strategies.
First in demo, then to the real world
Brokers can recommend proprietary applications or universal platforms. Make sure that the platform offers you a demo account so you can practice with fake money. Training is a crucial element to grow in the world of trading. Never trade with real money without first doing it in a demo account that allows you to create strategies, test them, learn market movements and see the general operation of the platform.
