Trading forex is one of the most complex works in the world. You have to calculate each move and each deposition. Just one mistake and it may cause you all your money. So, it’s essential to make good decisions from the beginning. Choosing brokers to work with is one of the most important decisions traders have to make when they first join the forex field. But as the market is developing, many brokers have been born and this makes traders even more difficult to rank the most reliable forex brokers in the market.
First, reliability is always my prior standard. As you all know, for a trader, the most wanted thing he would like to assure his own safety. There is only one thing that could ensure a broker’s credibility: the forex regulation. In order to get a regulation, the broker has to prove its abilities and its transparency. Going through strict evaluations, brokers who own a regulation are definitely trustworthy ones.
The regulations are usually set by profit or non-profit financial organizations with the purpose of managing brokers that under their rules. The rules between different organizations are usually the same at some basic points such as: the quotes quality, broker’s minimum operation fund, bonuses, and the accounts broker use to advertise or deliver important messages.
Disadvantages of forex regulations
Besides the regulation’s advantages, it also has its disadvantages.If your broker is under a US/UK regulations, probably the transaction cost as well the margin and the spread will be much higher.
In addition, clients also have fewer options on trading platforms and ways of payment as well. To fix this problem, many brokers choose to obtain 2 regulations. Among those regulations that the most reliable brokers are working with, I personally think the CySec regulation and the FCA one is the best since there are a lot of brokers under these regulations have a place in the top biggest retail brokers in the market.BEST FOREX BROKERS IN THE WORLD
They affect the costs
The same as any other traders, I also want to minimize the cost while trading. But traders that work with the US/UK brokers often have to bear a higher transaction cost. This is due to their strict regulations and brokers also have to pay fees for the regulations as well. While you have to pay 1.7 – 2 pips for EUR/USD transaction when trading through the US/UK brokers, other traders who work with other brokers will only have to spend 0.8 – 1 pip for that transaction.
But the more important thing that forex traders search for is the variety of payment methods and the quality of the payment system. There is a fact that in the Asian market, the US/UK brokers are bad options. Just imagine that you will have to pay from 1.7% to 4% for the bank to deposit through a visa card. And earning 5% profit is really hard. That’s the reason why traders shouldn’t trade with a US/UK broker. They should work with the most reliable forex brokers with a local payment system with several payment methods.