With the volatile economic climate of 2017, and a number of surprising election results, the prospect of making money on the stock markets is becoming increasingly attractive to a wide range of people. However, getting involved in forex trading can be easier said than done. Without an easy to use forex trading platform and a number of tools to help you along the way, it’s likely you will struggle. In this article, we’re going to take a look at some of the points to consider when choosing a forex trading platform as a beginner.
The forex platform that you decide to use must be regulated. This ensures that your funds are secured, and that it maintains fair dealing practices. While most developed countries do carefully regulate trading, the standards of regulation can vary widely. If you plan on trading in the US, therefore, it’s wise to choose a US based forex platform that is regulated by the CFTC and the NFA. If you are trading in the UK, you’ll want to look for a platform regulated by the Financial Conduct Authority. Avoid trading in locations like the Seychelles, Malta, Belize or the British Virgin Islands unless you are 100% sure the trading platforms are regulated to high standards.
3. Minimum Deposits
If you’re new to forex trading, it’s likely you won’t want to be spending a lot of money at once, at least not until you get used to it. However, some trading platforms have a minimum deposit to get started, which can be as much as $50 or $100. On the other hand, some trading platforms offer you the option of starting with a micro account, and only require you to deposit $5 or $10 to get started. These may be the better option unless the higher deposit platforms offer other features that encourage you to deposit more to get started with them.
4. Education Materials and Tools
Another important consideration for novice traders is whether the platform they are considering offers education materials and tools. Some brokers like Stern Options will provide you with a wide range of tools and articles to help you on your journey, while others won’t offer anything at all. Some of the higher end platforms, even offer VIP services where you will be given access to a personal advisor. This can be a great option if forex is something you see yourself taking seriously.
5. Customer Service
As a new trader, it’s very important that the platform that you choose to trade on offers good customer service. Helpful support staff can help to smooth over any issues you have in setting up your account and making your first trade. This is especially useful if you’re using a trading platform that wasn’t specifically designed for newbies. Most good brokers should offer a variety of ways to get in touch with them, including live web chat and phone support. Avoid any service which only provides an online contact form with no guarantee of when you will receive a reply.
6. Base Currencies
We mentioned earlier that it’s a good idea to take out a trading account in your current location. This isn’t only important for regulatory reasons. When you open an account with a platform in your country, it eliminates the need to trade currencies to get started. For example, if you are located in the US, but you open an account on a UK platform, you will need to trade your dollars to pounds to get started. This means that while you may make a profit on the platform itself, any changes to the base currency will also have an effect on you. If your home currency gets stronger against the base currency, for example, you will end up losing money when you go to withdraw it from your account.
7. Mobile Trading
Unless you plan on making forex trading your day job, you won’t want to be sat at a computer all day while the markets are open. Some forex platforms now have mobile apps, which enable you to trade via your smartphone or tablet without needing to be near a laptop. This is something that can really make your life easier, so it is well worth looking into whether the platform you are considering offers a mobile app, or at the very least, has a good mobile website.
Finally, it’s important to look at the fees you will be charged for trading through the platform. Some brokers will charge a commission on your trades, whereas others will charge you via spreads. You also need to look into the costs of things like deposits and withdrawals, account inactivity, credit card fees, and whether you will be charged should you choose to close your account. Remember, it’s not always wise to purely work with a low cost broker. Sometimes, those who charge higher fees provide a much higher level of service which is worth the price.
Getting started with forex trading can be quite a complex undertaking. However, every forex trader has to start somewhere and there are platforms that are designed purely for beginners. Hopefully these tips will help you to choose the right one for you.