If you find it difficult to choose the best forex brokers in the market, then you are at the right place. After reading this article, you will know how to compare brokers to each other before choosing to work with the best forex brokers in South Africa.
STANDARDS TO COMPARE
There are some common standards we use to compare brokers to each other:
- Trading conditions
- Types of account
Based on regulation, platform choice, and trading conditions for the clients, brokers are rated and ranked in the market.
In common, governmental regulatory bodies are those who set rules such as FCA, FSCA, CySEC & ASIC for brokers to follow. By making these rules, the agencies force and control brokers to create the safe trading environment and protect all the funds for traders. Often, governmental regulatory agencies have more trust in the brokers with more than one international license.
To trust a broker, we have to check these standards: trusted regulation, trade execution method, and client fund management.
Trusted regulation is that a broker should have regulations from the major governmental regulatory bodies. It can indicate that they gain a high level of trust and integrity from these agencies and so, they are very safe and reliable.
The next factors we have to check are: how the broker is executing your trades, if a dealing desk is involved in the execution, if there is any conflict of interest between traders and the brokers, if the broker receives financial incentive to have you lose your trades… When a bad thing like one of those above happens, it can indicate the less reliability of a broker. One of the most reliable brokers is Exness => Check Exness accounts.
A good broker should segregate all the client funds in different accounts at major banks in the local jurisdiction. Why so? Because it will protect traders in case of the bankruptcy of the broker.
It is the difference between the buy and sell price for a currency pair (the Bid and Ask price). If the 2 prices are far from each other, the spread is considered wide such as 15 pips, 18 pips,… If these 2 prices are close to each other, the spread is considered tight. As a result, traders like to work with brokers which provide the tightest (lowest) spread for lowest trading cost. There are various spreads in each broker.
Traders use the leverage to amplify the size of trades. They need this because movements of the market are so small that they would hardly make profits if there was no leverage. It would be impossible for individual retail traders to do business if they did not have any leverage. For example, a leverage is 250:1, it could be amplified up to 250 time. There are various leverages offered by each broker based on the experience of traders.
Most traders use these types of account: Live or Real accounts, the Demo accounts, and Swap-free account. There is rarely managed account.
Live/ real accounts
There are real conditions, real prices and real money. Your account balance is affected when there is any transaction or trade execution.
The trading platform, customer service, research area, and trading conditions,… are things for traders to try because this account is fake with unreal conditions, money and prices,…
In short, to choose the best forex brokers in South Africa, first, you have to compare the brokers using these standards above.
For Thai forex traders, click here for best forex brokers in Thailand