"Sino po broker nyo?" (Who is your broker?) I receive this question ALL. THE. TIME. So, I thought I'll write about it here, and hopefully, I can answer the subject better.
Brokerage is a very lucrative business, no wonder there are so many out there competing to our attention and money. In my research, I've seen so many promotions, some of their marketing tactics are shocking. Some resort to using semi-naked girls as their 'promo girls' I think that's just cheap marketing.
I once attended a free webinar on basic of Forex conducted by someone working for a brokerage company. He was supposed to be an expert in one commodity since he has been trading it and nothing else for years. Even gave us advice about a particular instrument, said that he was SURE that the price was going to go down, no need for stop-loss he said. If I followed this experts' advise, I would have lost all my money!
I've tried several brokers, had demo accounts with plenty and finally decided on a couple that has ticked all my boxes. Here is my checklist for choosing a broker.
They must be regulated. Some of the strictest regulatory bodies are in the UK, US, AU, Switzerland, Germany, France and Canada. This is a must because you can measure their credibility through this regulating bodies, if they are regulated by more than one body even better.
Transaction Fees. (Can I say just this - the cost of trading Forex is so much cheaper than trading stocks in the Philippines!) Some brokers charge a commission, some charges you through spread. Commission-free trading is great, but you should make sure that they offer tight spread too.
Platform. Most brokers offer free MT4 platform, other widely used platforms are Ctrader or MT5. My broker has a fantastic web platform too. When choosing a broker, you should open a demo and try the platforms they offer. You need to get familiar with this since it is a vital part of your trading.
Speed in execution. How fast your broker can execute your trade, especially in volatile times can affect your strategy and your profitability. Make sure they offer low latency.
Funding options. Make sure to check the process of deposit and withdrawal in your account, the fees on deposits and withdrawals is a factor that you should consider too. And, of course, how fast can they process your request. My broker takes a day on deposits and two days on withdrawals if you have a local bank. (I'll write about my broker some other time).
Customer Service. OF COURSE! How can you contact them for anything, do they have chat service? Email support? Phone support? Do they have an office near you? Some brokers can be very helpful and kind before you give them your money, they have an army of salespeople but after-sales team are very few.
This is my checklist on choosing a broker, yours may differ, but I believe this six should be a must in your list too. Majority of brokers offer a free demo account, make use of it. Call them or email them, ask them all the things you feel is relevant to you. You will be handling them your hard-earned money, do your due diligence.
Don't just open an account because of a recommendation. See, if it'll fit your needs too.