How to choose the appropriate Forex Broker – Free Training Course in Forex – Lesson 16

What is the role of the broker, exactly?

·         in natural conditions , the broker is a company that :

·         Plays the role of mediator between trader’s buyers and sellers.

·         Provides a trading platform that contains the spot foreign exchange rates and graphs, charts and indicators and data commands deals.

·         Provides economic services such as news and analysis, recommendations and other services such as customer service.

·         Execute deals through the commands that put the customer on the trading program.

·         Broker takes a fare to work on this work and other services.

·         As he plays the role of mediator between the trader and the bank which is the main financier for money deals.

Are brokers controlled by?

The best Brokers are that subjected to the laws of Forex and licensed by the Monetary Authority of the State where there are its offices, and in the table below-month global regulatory bodies around the world.

Regulators in the currency market:

In order to ensure to work with any broker in any place around the world you must make sure that the company is subject to the laws of its country and has a license to do so via recorded in one of the regulatory bodies or regulatory agencies, and this in turn helps you to not be fooled by the choice of brokers in Forex, we will present to you these regulatory bodies.

Do you want to recognize the names of the regulatory bodies and their countries?

Regulatory body	Control of state
CFTC - Commodity Futures Trading Commission - Governmental Authority of the U.S. Congress specializing in the organization of work in the financial markets of different types.	U.S.A
NFA - National Futures Association – it is the Commission on Trade in Goods of future and this association is responsible before the CFTC for monitoring private institutions affiliated and recording and verification of conformity to standards that include minimum safety dealers in this market in order to preserve investors' money and the support of the confidence of national and international in the U.S. capital markets.	U.S.A
FSA - Financial Services Authority	Britain
SFC - Securities and Futures Commission	Hong Kong
BCSC - Securities Commission in British Columbia	Canada
MIFID - The Markets in Financial Instruments Directive – it Is the law of the European Union, which provides alignment of the regulatory regime for investment services across the 30 countries, which is a member of the European Economic Area.	European Union

The mechanism of the Broker with the customer:

The customer opens an account with a Broker and funds the new account with money …

Broker is your agent for hire on the stock exchange after you open the account with him, an agreement is done between you works on the system, and then you have to fund your account with the amount of money you have, from your bank account or from your credit card or other financing methods.

And note that most brokers provide 3 types of new accounts:

1.       Micro account you need funding to $ 100 or more, and these small accounts are a great way for novice traders to be trained and to gain real experience in the early stages of their education.

2.       Mini accounts you need funding to $ 2,000 or more.

3.       Standard accounts you need funding to $ 2, 0000 or more.

Customer trading on the special trading program for a broker...

After the arrival of your money in your new account in broker, the trading platform for the broker will ask to specify a size of the deal that you want (ie, the amount of funding that you require you to open the New Deal), as well as determine the currency pair that you want to exchange the two and asking to buy or sell it, as well as for each data from the deal to determine the price of stop loss or take profit price.

Broker Booking insurance amount (the amount of margin) to open new deals:

Here broker in order to provide you with the amount of volume of funds the deal and that you are requested to start your new trade (ie, are providing you the amount of lot size or what is known as the amount of facilities Leverage to the New Deal ), the broker will book part of the amount of money that has been placed by you in advance for your account when you opened the account with him  , and the size of this part reserved than the amount of your deposit be in accordance with the terms of the agreement deal , which took place between you, and leverage to be provided by you to the company for the reserved amount, and this reserved amount is to be a lock to ensure that the broker recover amounts ( finance ) facilities leverage without increase or decrease when you end the deal.   

Broker gives the customer the cash facilities that register in his account and the immediate same sitting:

After asking to open a new deal in any size you want by Lot via the trading platform, the broker will provide here money from the bank, and recorded all the facilities amounts of cash in your account immediately and quickly over the Internet to make a sale or purchase.

Spread “broker fare ":

Of course, the broker does not work for free, the broker is known to be a mediator and win through the brokerage, and the brokerage in Forex means that the broker gets Spread and the bank has not a share of him at all (which broker gets on taxi services through the difference between the purchase price and the selling price) the spread shows in form of  points differences and which is a fare to the provision of services from program trading and market news and analysis, technical and customer service ... And other

Please note that the spread does not have anything to do with the final facilities leverage provided by the broker of the bank-funded to the customer.