Home Business Insights & Advice Looking for a broker? Use this checklist

Looking for a broker? Use this checklist

by John Saunders
12th Sep 22 2:31 pm

Are you searching for a good broker? Of course, everyone wants to do business with a high-quality, reputable firm. There’s no question about that fact. The problem arises when prospective traders begin trying to define the word good in terms of online brokerage services. So, what are the chief characteristics of such a provider? There’s no all-inclusive list, but experienced traders would probably agree that there are several qualities everyone should look for, keeping in mind that different traders have unique needs and personal preferences. In addition to finding the kinds of platforms that suit your style of buying and selling, it’s essential to vet all potential candidates carefully.

What are some of the other areas people should focus on when looking for a trustworthy and capable provider? A wise place to begin is to read as many online reviews as possible, check the company’s regulatory status, and evaluate its experience in the industry. Other relevant ways to measure the overall quality of a firm are to examine the kinds of educational materials it offers, find out whether they offer the asset classes you’re interested in trading, and do a live test of the company’s customer service department. Here’s a brief rundown of the most pertinent subjects every potential trader should examine when selecting a top brokerage firm.

Platforms

Check out the options for trading platforms offered by all the brokers on your shortlist. Some of the industry’s leaders offer mobile, web, and desktop versions for people who want the ability to buy and sell anywhere and anytime their favorite markets are open. The trading platforms by AvaTrade, a top online provider, include all three varieties. Some have no use for mobile functionality, so they shouldn’t be concerned about that capability. Just be certain that you know which kinds of platforms are available before signing up for an account.

Reviews

There’s no need to spend hours and hours poring over reviews. The goal should be to find relevant, reliable review websites and spend about 15 minutes perusing several of the detailed ones within each category. Nearly all the top service providers are widely reviewed on authentic sites, with many hundreds of verified assessments you can look at and base your decision upon.

Regulation

Only work with regulated firms. Offshore, unlicensed, unregulated companies exist and offer all sorts of financial enticements. But the risks far outweigh the rewards. Always find out where the company is located and under what financial jurisdiction it operates. It should be easy to find these details by scrolling through the firms’ websites. If the information is hard to locate, hidden, or omitted, move on to your next choice. There’s absolutely no reason to put your capital at risk with an organization that is not regulated by the authorities. Unregulated businesses disappear along with their clients’ money, so just don’t take that risk.

Instruments

Be aware that the only instruments and asset classes of importance are the ones you intend to buy and sell. If you’re a forex enthusiast, don’t be concerned if a provider does not offer equities or futures contracts. Few online entities offer all asset classes, and the vast majority tend to specialize in two or three instruments, like forex, stocks, crypto, and CFDs. So, narrow your choices based on the assets that interest you the most.

Experience

How many years of experience are you comfortable with when it comes to a brokerage firm? Ten years is a good benchmark, but even longer than that is better. Companies come and go in the industry, so if you find a provider that meets all your other basic requirements and has more than 10 or 15 years of experience, that’s a huge plus.

Demo accounts and educational materials

Newcomers to the industry should pay close attention to a website’s educational materials. Nearly all offer at least a small section of books and articles. However, it’s wise to look for tutorials, educational videos, and access to a full-fledged demo account. The top players in the industry offer all three. It’s imperative to spend at least a full week trading via a demo platform with fictitious funds. There’s no better way to hone your skills as a trader.

Other considerations

Call or email the various customer service departments of your shortlist candidates to see how quickly and accurately they respond to inquiries. Also, pay careful attention to the schedule of fees, commissions, and charges for account holders. Find out whether the company specializes in a particular asset or type of client. Explore the research tools section, see which deposit types are accepted, and strive to work with a provider who makes it easy to open an account.

 

The above information does not constitute any form of advice or recommendation by London Loves Business and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Appropriate independent advice should be obtained before making any such decision. London Loves Business bears no responsibility for any gains or losses.

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