I know the Forex Business since 2010. First as beginner trader - manual -, after being professional and asset manager using Forex on a daily basis. A lot of people following me gained a lot of money, me a little finally but I was able to live from it during 6 years with a Swiss Standard of life - Swiss people knows what is the meaning of that -.
The 2 last years was different for many reasons which are more businesses reasons and strategies than "trading reasons".
Before you start trading Forex like I was - a beginner.
Note that, for me, every people who were not involved in the business is a beginner,
You need to know that you will be treated as a lone wolf and you will never find your pack. Never.
Other wolves will chase you and attack you.
"humans" (means brokers in our reality, i will explain to you why later.) will only treat you for what you are: an animal to be killed if you come close and perhaps let you live alone if you are too far away of their guns and don't threaten their profit.
Others animals will only hate you.
Your decision will be your decision only.
Your victory will be your victory and your defeat will be yours too. Nothing to share.
Be prepared to hunt and be hunted, walk long(s) day(s) in the blizzard to find your next piece to eat and be never seen as gentle, kind of other "domestics" words.
Ok...good words and what?
First, you will not choose a partner selecting a broker but only another wolf - like you. Bigger with a pack behind him and his pack is not "your pack" (don't forget you don't have a pack behind you). It means that you will be watching him as the most dangerous threat for your wealth and the first decision you will make when you will grow is to try fly away from him.
Indeed, except in Switzerland which has the best financial regulation in the world for customers, brokers are not banks....the majority of them are only intermediaries which send your(s) order(s) (or not) to the market trying to grab some money at each exchange. They rely on other intermediaries bigger and stronger who only "rent them" their tools and liquidities.
"Liquidity is the ability to find a seller or a buyer for the order you want to send "to the market". "The market" for forex is only a giant software trying to find sellers and buyers automatically.
Smaller is your "broker", smaller is the chance for this broker to find a seller or a buyer for you at the price you ask.
Then they "gather" with other smaller broker the orders and send them to a bigger wolf which does the same with a bigger one ect...
"The end" is a TOP BANK as UBS, Goldman, Credit Suisse, Deutsch Bank, ....the TOP 10 worldwide bank. This banks are the lead wolves and the "golden pack". All other "wolves" are domanited by them. They order.
Each time a broker is gathering the order for you trying to find sellers or buyers with "its liquidity provider", each time they ask you money for it.
And worst of the worst, the smaller of the smaller don't send any order to the market: they only keep the orders for them and push you to lose. They make manipulation on the price feeds, you hit stop-loss in a very strange way sometimes, or they simply push you to play with the news - which is the best error to do as a beginner.
Then you have understood the key first decision you have to make : selecting the right broker no ? the more gentle "lead wolf" ?
You need to search in countries where regulation is the higher for customers, mean where you can easily go to trial or threaten the broker to go and where the companies can be easily controlled by their regulation body with high fines behind.
Then when you are about to select a broker, you need to answer this 3 questions without any doubt in 10 seconds :
1 - Do their offer bonus?
If they offer bonuses: just go away. It's mean that they won't sell your order to the market. Do you believe that someone will give you money to trade ? are you a joker ? If you are naive. Just stop here. Naive wolf is a future dead one.
2 - Are they in or do they operate with a valid licence in USA, Switzerland, Japan, Singapore, Australia or in any WESTERN European country outside Malta and Cyprus and UK *?
If they are not in the list of the question 2-, don't even think to deposit money for a live account. Just go away. There are thousands of brokers - and serious ones - in the countries above, no reason to go anywhere else. Just avoid any small lost island as grenadine, san xxx or other exotic name. If you don't know the country, avoid, go away.
3 - How long the company is existing?
Take only companies with, at least, 5 years of existence with the "TOP COUNTRIES" (Switzerland, USA, Australia, Japan, European outside Malta and Cyprus)
(* ) Malta and *Cyprus could be considered because they are "MiFid" (European Regulation) but you need to have a strong proof of the existence of the company and ask for probe of assets. This companies, for me, needs to be in the market with 10 years of existence to have a level of security "acceptable". But if you have the choice, pick more outside Malta and Cyprus.
(*) UK was the country where binary options were born - more or less - and binary options is only gambling with the false promise of gain. You can't win. It's not done for that. Also UK has a very weak protection of customers. If you have the choice, prefer Swiss or European based companies or US ones or Australian's ones. Avoid New-Zealand ones which is an "heaven" for small companies with very low cash-flow.
Never start with a young company in forex. NEVER !
Try to see if the company exists going the website of the chamber of commerce like www.zefix.ch in Switzerland. "Google" people on the board and see if they are not linked to any bankruptcy, it may help a lot.
Companies who are proposing binary options are only cheaters: you need to avoid them at ALL COSTS if they base their business on it. It's a very good way to see if people are serious behind. Binary options is gambling and there is no robot running on it with real performance. Nobody can do it.
What is the broker you have selected to start with ?