Singkilisme.com – One of the terminologies you need to know if you enter the world of forex is about forex brokers. What is that? The following is a more detailed explanation which is also referred to as a forex broker.
A forex broker is a company / institution that facilitates currency (forex) traders with access to a trading platform that allows them to buy and sell foreign currencies.
Foreign exchange (foreign exchange) trading brokers / brokers, many also refer to as retail foreign exchange brokers or forex brokers, handle a small portion of the overall volume of the foreign exchange market. Currency traders use this broker to access the currency market 24 hours a day.
Forex Brokers Explained
Forex brokers are compensated in two ways, first through bid-ask spread of currency pairs. For example, a retail FX broker can buy Euros for US $ 1.2010 and, at the same time, sell Euros for US $ 1.2015. Differencein this case, it is $ 0.0010 or 10 pips.
The second way, brokers often charge a fee per transaction. However, over the past five years, competition has increased from fx brokers, who have offered many free or very small offers.
Forex brokers will allow clients to trade all major currency pairs; EUR / USD, GBP / USD, USD / JPY and USD / CHF as well as the remaining g10 currencies and all cross interest rates. Additionally, most brokers will allow clients to trade currencies emerging market.
Before trading, forex brokers will ask clients to deposit money into their accounts as collateral. However, through leverclients can trade larger amounts than those stored in their forex trading account.
It is worth doing some research to find out if the broker has a good reputation and has the functionality you are looking for in a broker. Most reputable forex brokers will provide potential clients with the opportunity to use a demo trading account so that they can have a good understanding of what the forex system is like.
It is a good idea to test as many platforms as possible before deciding which broker to use. Also, as the forex market is a 24/7 market, the most qualified forex brokers will provide 24/7 customer service. (Further reading at: Tips for Choosing a Forex Broker / Broker)
Writing source: www.investopedia.com