Compare brokers - Best Forex broker and best trading site

Compare brokers – Best Forex broker and best trading site

Table of Contents

Wanneer u als aspirerende trader wilt starten met online trading, moet u allereerst uitvinden wat de beste Forex brokers of trading sites zijn. Online trading is in de afgelopen jaren enorm in populariteit toegenomen. Uw broker keuze bepaalt in verregaande mate uw handelservaring. Het animo voor online trading heeft ervoor gezorgd dat er thans meer Forex brokers en trading sites dan ooit zijn. Nieuwe aanbieders schieten als paddestoelen uit de grond. Het ruimere aanbod heeft zijn voordelen.

If you are going to compare brokers, you will notice that there may be significant differences between the services, quality, conditions and associated broker rates of different trading sites and forex brokers. This way you can determine which provider suits you best based on your own preferences and needs and is the best forex broker for you.

However, the other side of the coin is that in addition to legitimate Forex brokers, there are also more and more trading scams and fraudulent trading sites. Trading concerns your capital. It is therefore crucial that you choose a reliable broker.

In this article we will discuss what to look for, if you want to compare brokers or if you want to select the best trading sites.

What is an online broker?

If you are going to compare brokers or want to assess whether your choice is indeed the best Forex broker for you, then you will first need to have clarity about what a broker is. As an individual trader, who trades relatively small trading volumes, you cannot gain direct access to the markets yourself. An online broker or Forex broker is basically a financial intermediary that gives you access to the markets. Following the same idea, trading websites are basically online platforms where traders can buy and sell foreign currencies or other financial assets.

In this article we refer to trading brokers as Forex brokers. A Forex broker is strictly speaking a broker that offers you access to the foreign exchange market. However, in this article we use Forex broker for reference to online brokers in general. Now that currency trading is the most actively practiced form of trading, Forex brokers make up the largest group of online brokers. In essence, these nuances today are mainly theoretical.

Almost all online brokers offer access to different markets and instruments. For example, with many Forex brokers you can also trade stocks, indices, commodities and cryptocurrencies. The competition among online brokers makes online brokers as attractive as possible for potential clients.

Reputable online brokers / Forex brokers increasingly offer free (temporary) demo accounts or trials with which you can test their services and products yourself, risk-free and without obligation.

Compare brokers and choose the best Forex broker

The foreign exchange market is the largest financial market in the world with a daily trading volume of 5.3 trillion. The market is open 24 hours a day, 5 days a week and as such is accessible to traders anywhere in the world, at any time of the day. The construction to facilitate these (almost constant) activities is a decentralized network of exchanges around the world. What this means for you practically is that the Forex market is not a central meeting place. In order to participate in trading, you need an online broker that gives you access to these and other financial markets.

We suggested earlier in this article that choosing the best online broker or best Forex broker is a choice that is largely personal. Different traders choose different brokers that meet the criteria and preferences they have set based on their trading strategy and style. However, there are some rules that are universally applicable. In this article, we focus on the aspects that are important regardless of which trading form, your trading style or instruments you choose.

Compare Best Online Broker or Best Forex Brokers

Technological developments and growing dissatisfaction with traditional forms of investing and investing have boosted the enthusiasm for online trading. Trading is more popular than ever. The exponential growth in participation has ensured that brokers offer ever better services and conditions.

This not only means that the selection of instruments to be traded is usually very extensive and forex brokers (online brokers) also offer the possibility to trade other assets such as shares, indices, cryptocurrencies and other CFD instruments. Another advantage is that the rates and presented trading conditions, as a rule, will be more favorable.

Unfortunately, there are also disadvantages. The increased interest has not escaped investment fraudsters either. We have seen an increase in the number of questionable online brokers and trading sites in recent years.

It is therefore extra important that you ensure that you do not fall prey to these fraudulent practices. The first criterion for separating the wheat from the chaff and filtering on reliable brokers is regulation. Choose an online broker that is regulated by a reputable market authority. We will discuss this in more detail in the next paragraph.

Choose a Regulated, Reliable broker

The legitimacy of Forex brokers and online brokers is more central than ever in 2019/ 2020. After online broker scams came to light and abuses were recognized, laws were passed to curb fraudulent offers from brokers and protect consumers.

Of course, this is not enough. New online brokers and trading sites appear on the web almost daily. The insidious thing is that it is not always clear at first glance whether you are dealing with a scam or a reliable broker. Many investors have gone wrong and some have even lost money. To avoid falling victim to this type of practice, it is highly recommended that you choose an online broker that all has the licenses that guarantee a fair service.

In Europe, there are several market authorities and regulatory bodies that can issue such licenses. However, not all licenses are created equal. By far the most popular accreditation is the CysEC license. The CySEC regulation originates in Cyprus and sets the relatively low threshold conditions. When trading with a CySEC regulated online broker, it is useful to check the status of this online broker / Forex broker in the database of a reputable regulator such as the AFM (the Dutch financial markets authority) or the leading British FCA (Financial Conduct Authority).

You may be surprised to learn that many online brokers that are blacklisted by the AFM or the FCA are linked to this license. We can therefore say that the CySEC license is the absolute minimum. However, a broker regulated by a European market authority (including the Cypriot regulator) can operate freely throughout Europe. For your safety, the first thing you should check is if and where your broker is regulated.

If you are looking for a reliable broker, a professional-looking website does not guarantee that the broker is actually regulated and reliable. You obviously want to avoid trading with an online broker that does not have things in order or is not bona fide. A good filter is to focus exclusively on online brokers / forex brokers that are supervised by a reputable market authority. Think of a respected, regulatory body, such as a body like the British FCA.

In addition to knowing that these online brokers adhere to stricter rules and meet higher standards, you also enjoy extra protection measures in the unlikely event that something goes wrong with such a broker. When you trade with an FCA regulated Forex broker you benefit from protection measures under the FSCS (Financial Security Compensation Scheme) regulations.

This system is similar to the deposit guarantee scheme where up to 50,000 of the funds you hold with your broker are guaranteed, if it is in financial difficulties or should go bankrupt. This is an additional security measure, and offers you and your capital more security. This is a major reason why online brokers/ forex brokers from the United Kingdom are generally ranked as the best brokers. Online brokers with an AFM quality mark are also reliable brokers.

FCA and AFM regulated Forex brokers must therefore meet strict requirements when it comes to registering clients and opening accounts. The supervisory authority requires that the Forex broker must be able to provide clear, correct copying of the identity document and proof of address of clients at all times.

In addition, the deposits and withdrawals from bank accounts must match the data in the administration (such as the data on identity and residential address). So it’s also not uncommon for regulated brokers to ask for identity documents, proof of address, or a copy of bank statement. Admirals is an FCA regulated online broker and chooses to commit to the strict requirements and standards set by this regulator.

On our website you can find more about the regulation of Admirals under the “About Us” menu tab.

Reliable brokers & financial security

If you want to compare brokers and are looking for the best forex broker or best online broker site, it is important that in addition to strict regulation, you also scan for additional measures set by the broker that guarantee your financial security. In addition to security in the form of deposit guarantee or a comparable protection scheme, it is also wise to check how a forex broker handles the capital of its clients. A thorough online broker will provide transparency about this.

Brokers Leverage and Margin

By trading with leverage, traders can take positions that are many times larger than is normally possible based on their available capital. The attraction lies in the potential to benefit from any associated profits. When applying the leverage effect, the remaining part of the position is financed by the broker. It can be seen as a credit provided by the forex broker/ online broker. The Forex broker charges a fee as a fee for the availability of leverage.

Leverage is usually expressed as a ratio. For example, 1:100. At Admirals, different multipliers are available depending on the account type. You can, within certain limits, determine the leverage factor yourself and adjust it to your stock or Forex account. The applicable, maximum available leverage effect also depends on your client status and the instrument to be traded. The higher the factor applied, the greater the scope of the margin you have invested.

This construction offered by Forex brokers or online brokers allows the trader to make bigger steps with the resources at his or her disposal. Suppose you have reserved EUR 100 to trade with. This generally offers little or limited opportunity for investment. If you want to buy shares without leverage, the price of which is EUR 10, you can only manage 10 shares. If the value per share increases by EUR 0.10, the total profit on your position is EUR 1.

Trading with a broker that facilitates margin trading offers a solution for traders who want to get more out of their capital in the short term. For this group, leveraged products can be interesting. Assuming the same scenario; where you only have EUR 100 to invest but now use leverage of, for example, 1:20, you can now manage 200 shares of EUR 10 with the same EUR 100. However, the flip side of the coin is that potential losses are magnified by the same factor.

Keep in mind that regulated brokers under recent ESMA legislation impose certain additional conditions on trading with leverage and the available ratios are limited. If you are looking for the best online broker for margin trading, you can compare the different leverage ratios and associated fees. Admirals is an FCA regulated online broker and offers leverage from 1:2 to 1:500 depending on your client status and the instrument to be traded. Choose a factor that fits your trading strategy and matches your profit goals and risk tolerance. level.

Financial leverage and margin trading are two very important concepts when it comes to online Forex trading and CFD trading, so make sure you understand them well, read the corresponding linked articles or ask the service desk for more explanation.

What is the cheapest broker?

There are different types of online brokers. In addition to the (usually only formal) distinction between Forex brokers, CFD brokers or crypto brokers, we can also classify online brokers based on their systems and revenue model. Brokers typically charge fees for processing and passing orders. They earn a spread or commission when the trader places an order on the market.

Most online brokers/ Forex brokers calculate spreads. The spread is the difference between the buy and sell price of an instrument at any given time. The fees may vary depending on when you trade and per instrument. The default spread for the EUR/USD currency pair is usually 1 pip, while the spread for trading the DAX 30 is normally 0.8. These are the spread fees during normal trading hours and the rates mentioned may vary in certain periods or at given times.

The spread costs can also vary greatly per online broker / forex broker. A reliable broker will provide transparency regarding spreads and other broker rates. Typically, the more actively an instrument is traded, the smaller the typical spread will be.

Compare broker fees – SWAPS & Commissions

Behave spreads can also charge online brokers commissions and SWAPS or ‘roll over’ fees. These are financing costs for holding a margin trading order overnight. The time at which the SWAP costs are settled is 23:00 Dutch time. On one day a week (for most instruments on Wednesday) the SWAP fee is charged 3 times. For the Wednesday on Thursday itself, and for the weekend days. SWAP fees vary per instrument and you can find the applicable rates in the broker terms and conditions. Read also: Islamic SWAP free account.

Compare broker fees – Different trading accounts

Please note, in addition to the fact that you should be aware that the costs vary per online broker and differ periodically, the broker rates used at one and the same broker can also vary at the same time.

For example, Admirals offers different account types where the trader pays different costs. On an ECN account, the online broker does not charge any commission, only spreads. On the Zero.MT4 account, for example, there are commissions for opening an order but you can trade against spreads from 0 pips. Depending on your account type, your online broker may apply different conditions and rates. Choose the account type that best suits your trading style and is the most advantageous.

Read more about the different account types on our website or contact our Dutch-speaking team of experts.

Compare fees brokers – Online brokers without fees

Your trading experience is largely determined by your online broker choice. The quality of execution, the prevailing trading conditions and fees can affect your trading results and even include the difference between profit and loss. However, it is important to be wary of forex brokers/ online brokers that advertise commission or spread free trading. These types of online brokers are usually scammers. Remember that online brokers themselves incur costs to grant their clients access to the market and they must at least recoup their costs and it must also be worthwhile for the broker itself. If there are no commissions or spreads, you may wonder how the broker can pay you any profits.

Forex Brokers deposit / minimum deposit

Another element that many traders take into account when answering the question of which broker is the best online broker or best Forex broker for them is the required minimum deposit or the initial deposit that the broker asks to activate the trading account. Depending on your chosen broker and the selected account type, the minimum deposit required can vary greatly. Many traders mistakenly see the minimum deposit as a cost item. They are tempted by Forex brokers who advertise with so-called no deposit accounts. Please note that the minimum deposit requirement at Admirals is relatively low and is motivated by the practical necessity that some Forex start-up capital is required to start investing.

However, there are novice traders who are reluctant to deposit capital. For those who want to build familiarity with the dynamics of the market, the basics of trading and test different strategies &techniques in a risk-free way, some Forex brokers / online brokers offer a demo account. With a demo account from Admirals you can start investing under real time market conditions without having to have any starting capital – you only trade with virtual funds.

A much more important aspect, which is too often neglected, is the minimum trade size. Not all Forex brokers allow traders to trade in small position sizes. Mind you, the larger the positions, the more risk. It is important that your broker allows you to start investing with small amounts so that you, as a novice trader, can familiarize yourself with the market dynamics and principles of trading before investing more.

With Forex brokers such as Admirals, for example, you can trade even very small micro lots. This allows you to adjust your position size to your risk appetite and trading strategy. Especially for the novice trader or for the trader who likes to limit his exposure, the ability to trade small position sizes is very important. Check the terms and conditions of your Forex broker to find out what the online broker’s policy is on this. .

Brokers range of instruments

When assessing the best Forex broker or best online broker, pay attention to whether the broker offers the instruments that suit your trading style. Some traders have a strong preference for some specific instruments while others, for example, have the need to trade at certain times and will trade instruments that are then active. In this case, it is important that your online broker offers enough instruments with good liquidity over several trading sessions.

It is important, especially for novice traders, that they have the opportunity to experiment with different assets. Moreover, there are many traders who like to combine different assets. After all, the golden rule of trading and investing is ‘maximize your profits, limit your losses’. According to experienced traders, building a balanced investment portfolio is a determining factor for consistent profitability in the long term.

Broker informatie op de website

Research into the most reliable broker or best online broker/ best forex broker usually starts on the provider’s website. Don’t just be guided by the marketing talk and promotions on the page. Every broker or trading site should provide clear, public information on a number of key points.

Broker registration number and license number – any regulated online broker/forex broker will list information about its license with the authorized financial regulator. On the trading website of Admirals you can find our registration and license numbers under the “About Us” heading. You can verify this information in the broker database of the relevant authorities.
Contact information of the online broker – although we talk about online brokers and trading sites, it is important that the forex broker does not just have an online presence. The best online brokers list contact information such as e-mail addresses, telephone numbers or a chat function It is important that your online broker is easy to reach. Be careful with broker and trading sites that only have online contact forms, are difficult to reach or, for example, call with unknown or protected numbers.
A good online broker or trading offers clarity and transparency regarding its trading conditions and rates. A reliable broker like Admirals makes its Terms and Conditions clearly available on a dedicated section on the website.
Pay attention to the bank details of the online broker – check whether the name on the forex broker’s bank account matches that of the broker or trading website or party mentioned in the terms and conditions. For example, take a look at our website and you will see that the account is in the name of Admirals and that we work with a solid bank, Barclays.
Also pay attention to the deposit and withdrawal options. With a forex broker like Admirals you can make deposits and withdrawals via our secure Dashboard. You can choose from different transfer methods and can easily view and manage your balance information.
Please note that online brokers or forex brokers provide access to financial markets. Their function is not to provide investment advice. In fact, the best online brokers will never give investment advice or tips. If your Forex broker alerts you to trading opportunities or investments that allow you to generate profits quickly, for example, you should be wary. For regulated online brokers it is forbidden to give investment advice.
Different broker accounts – as we’ve touched on before, the best online brokers will typically offer multiple account types. The best forex brokers realize that not all traders are the same and offer different account types to offer traders with different trading styles the best conditions and benefits.

If you want to compare brokerage accounts, it is important that you can clearly and clearly view the different properties, conditions, costs and any restrictions and limits per type of account. Choosing the best online broker is not just comparing brokers, in order to trade at the best conditions, traders will also compare the accounts of brokers.

An account type where a commission you pay per trade but do not owe a spread may be more interesting for a long-term investor than for a scalper, who holds many trades at the same time. There are also certain brokers (and broker accounts) that do not support the application of hedging techniques. In your search for the best online brokers, start from your personal trading style, the chosen instruments and the dominant form of trading.

Brokers education offer

Of course, it is ultimately the responsibility of the client himself to inform himself about the basics of trading and the characteristics of the market. However, the brokers that qualify for the title of best online broker or best forex broker will support their clients in this and offer them tools.

Apart from theoretical knowledge, it is the exercise that can make the biggest difference in trading. The best online brokers/ best forex brokers recognize that the financial markets are dynamic and trading requires adaptability and constant improvement. As you gain experience and knowledge, you may want to test other trading styles, try out a more sophisticated strategy, or expand your investment portfolio. Even experienced traders will always strive for improvement. They actively test new techniques and tools.

Leading brokers will respond to these needs. It is advisable to test new techniques and strategies first in a risk-free environment. Admirals offers you several options for this. Depending on your trading software you can use a trading simulator or a demo trading account.

A free demo account is a good and important tool to gain experience. Use your demo account in combination with educational materials to further develop your trading skills. Admirals is one of the few online brokers that offers such a wide range of educational materials. From educational articles and analysis posts to complete trading courses and video tutorials.