How to Choose the Best Forex Broker Platform
How to Choose the Best Forex Broker Platform - The brokerage fees offered by the forex platform are not free. You pay for this through spreads, commissions and rollover fees.
The commission structure varies from one Forex broker to another and even from one account type to another. There are two main settings that are widely used.
Spread only: all other costs (excluding rollover) are included in the spread.
Mixed Commissions: In addition to spreads, commissions may also be subject to margin.
Most forex brokers make money from currency pair spreads. It can be fixed or variable. Fixed spreads are fixed constantly, regardless of market volatility. Variable spreads vary depending on the asset traded, volatility and available liquidity.
Daily spreads may differ slightly between forex platforms, but active traders (or even very active traders) open positions so often that small spreads can build up.
Traders should always look for a forex broker with low spreads. Forex brokers with 1 pip fixed spread and ECN brokers cannot offer any slots.
The commission structure is usually appropriate for other tradable assets such as stocks and equities. However, you may run into a situation where the forex broker charges a commission. Use the profit calculator to see if this compensates for the lower spread.
Forex positions that remain open overnight are subject to an additional commission known as the rollover rate. These fees are due to the difference between the interest rates of the two currencies.
While most forex brokers offer a good selection of currency pairs, they do not cover all minor and exotic currencies.
For example, if you want to exchange Thai Baht or Swedish Kronor, you should double check the list of traded assets and currencies. These coins are sold less frequently and therefore cannot be offered on all platforms.
If you are interested in big pairs (see below), all brokers will meet your needs.
US dollar / euro
US dollar / British pound sterling
EUR / GBP
US dollar / Japanese yen
Euro / Japanese yen
Although the Australian dollar and Swiss franc are considered a minor pair, they are often traded in large quantities. You can read about it here: AUD / USD or USD / CHF.
There are brokers who will do their best to serve traders. Some will even add exotic and global foreign exchange markets upon request. This flexibility is a critical asset.