How to Know If You Can Trust Your Forex Broker

It is possible to evaluate your forex broker through ratings and feedback by real clients. The brokerage industry is very transparent and word gets around fast.

What to Look For in Your Forex Broker

Your forex broker may or may not be the best. Nonetheless, the brokerage industry is so competitive today, that all brokers have to be constantly improving. Or else they will become complacent and will gradually lose their business. As a result, even bad brokers of the past, that had gotten a negative reputation, may have improved beyond recognition today. So what defines a good broker is first and foremost its ability to listen to its clients. And to look out for their clients’ interests. Every forex trader wants to trade forex through the best possible broker. And trusting that broker is essential, since all good business cooperation is built on trust. This is not blind trust, but rather it is a trust based on feedback provided by other clients. Brokers that have many satisfied clients cannot be bad. Or else these clients wouldn’t be trading through these brokers.

forex broker
Today’s savvy traders perform a reality check on all brokers. Unlike the immature feedback that newbie traders give, in an effort to blame their trading failures on their brokers… Savvy traders see what’s under the hood, and understand a broker’s limitations, especially during extreme volatility and fast trading conditions. Savvy traders see beyond the obvious, and rate all brokers very objectively. Brokers having such ratings can definitely be trusted.

Where Your Forex Broker is Allowed to Be Rated Bad

Many traders, especially small size new traders and day traders often blame their brokers. But the truth is that their bad trading is to blame for their own failures. It is always easy to blame trading failure on a broker. All brokers can perform badly at times of extreme market volatility. Where there will be slippage and requotes when trying to place trades. The best brokers do their best to minimize these effects and to operate in their clients’ best long term interests. All in all, what really matters is the feedback provided by large size traders, day traders and swing traders alike. This feedback is very insightful and impartial. So that good brokers that can be trusted are revealed through real life, large retail size live trading stories. Brokers are allowed to perform somewhat badly only during extremely volatile conditions, but not too badly. Your forex broker may actually be better than you think, but you need to see what other traders have to say as well.

Most Well Rated Brokers are Good and Worth Your Trust

Online forex trading requires very good trading conditions, and competition among brokers is fierce. Ratings by real traders reveal the truth about all brokers. And the fact is that you can trust many brokers among the well rated ones. There are some bad brokers out there, and these are also revealed by former clients who share their own experiences. Sometimes there are screenshots and documented evidence revealing what went wrong, and where the broker’s trade software failed. In other cases the whole way of handling clients’ trades is believed to be flawed. But these few bad brokers are revealed 100% by real clients. There’s no place for bad broker to hide, in today’s world. Moreover, traders themselves are savvy people, especially veteran traders. So their collective opinion does form an overall rating, on all brokers involved, which is truly impartial and reflective of the truth. After seeing what seasoned traders – clients of these brokers have to say, you can be sure about your forex broker. The big truth is that the truth cannot hide. All the good and the bad about any broker are sooner or later revealed.

The Benefits of Online Forex Trading

Online forex trading is seen by outsiders as a risky way to invest one’s money. And it is undoubtedly risky. But little do they know about the bigger picture.

Online Forex Trading Brings Investing and Trading Together

Online commodity and forex trading is widely misunderstood among outsiders. As being a risky way to play the markets. But things are not black and white. Classic investing and fast trading actually do overlap, and there is a lot of gray area. There is no easy way to classify one investment or another on the scale of risk and reward. And the same applies to forex trading, of any time frame. This is because profitable traders hardly ever share their secrets. And it is therefore impossible to know how profitable trading can really be. Proponents of forex trading do in general make money trading. Whereas critics of forex trading are usually former losing traders, or jealous outsiders. Whatever their reasons for trading might be, wise forex traders find one priceless thing in the market. And that is fairness! The forex market is the most equal opportunity place to be. A true land of opportunity, where prior background, social class, political connections or money, are not of any help. The little poor guy can still win over other traders who have all these things.

Online Forex Trading Offers Enormous Earning Potential even to Disadvantaged People

Live forex rates are very difficult, perhaps impossible to predict in real time. But wise traders look for clues on the charts. The daily charts provide valuable insight into the underlying trend. But online forex trading is a whole lot more than that. Because there are commodity-specific currencies, where the price of the relevant commodity has a huge impact on the actual currency pair. And commodity specialists, such as producers and merchants. Know how to predict a good portion of price movements in these commodities. Today’s trader can do it all, from forex to commodity trading in a single CFD online Forex trading platform and implement very good strategies. But in the old days some people still were able to achieve some trading success. Either directly from the markets, or by somehow making use of skills or information relating to market price movement.

Online Forex Trading
The power of information in a nutshell…. In 1923 Aristotle Onassis was a starving war refugee from Turkey, who arrived in Argentina where he got a job as a switchboard operator at the country’s phone company. Just by listening in to international commodity traders’ conversations (possible for a switchboard operator then), he was able based on that information, to make some spectacular trades in the commodity markets. And that’s how he earned his first fortune.  Later became very rich through continuous investing. That’s why information coming from commodity specialists is priceless in today’s world, where CFDs can facilitate extremely good and even more affordable strategies. Critics of trading don’t really understand the earning potential trading can offer.

Opportunity is Always There

Inherent market risk prevents many trading opportunities from being fully exploited. And it always will be this way. Because some people will never trade or even invest in commodities and currencies. The market never becomes saturated, and despite the advent of automated trading programs and sophisticated trading, the risk and reward will always be there. Markets do change over time, in terms of volatility and trading patterns. But the fundamental principles of risk and reward are always present. And it’s a two way impact, as commodities impact currencies. But also currencies impact commodities. Therefore wise CFD traders do not treat these markets as being separate from one another. But rather as one large market. The average online forex trading platform today offers CFD instruments for implementing unbelievably good trading ideas.

Online CFD Trading and Spread Betting – What are the Differences

Online CFD trading is significantly better than spread betting. Though the main advantages are hidden at first, and are later fully revealed in actual trading.

What Online CFD Trading and Spread Betting Offer

Both online CFD trading and spread betting seem a lot alike, especially in slow moving markets. Spread betting is more convenient for beginner traders. As market prices are quoted in whatever currency the spread betting account is based in. CFD markets are quotes in the currency that the specific market is based in. For example CFDs on crude oil and gold, will be quotes in US dollars. And this may be confusing to beginner traders, not very familiar with the US dollar. CFDs are subject to capital gains tax, because they are classed as real trading instruments. So all gains, and some losses, through CFD trading, are taken into account for calculating tax liability. Spread betting is classed as gambling, and is exempt from capital gains tax. Generally, spread betting appears more convenient and appeals more to beginners. Spread betting however is not suitable for serious, dedicated fast trading such as day trading. Spread betting pricing can deviate significantly from actual market price. Whereas CFDs are extremely linear in their pricing. Which enables traders to trade at any speed. Since they follow actual market price very closely, and reliably. CFDs also offer uniquely large liquidity, even better than that of direct market access. This liquidity is available always, to retail traders for up to $100 per price point.

Online CFD Trading
Spread betting is good for satisfying one’s early curiosity in exploring the financial markets. Just like kindergarten toys were useful in exploring the world in their toddler years. The problem is that when it comes to serious financial trading, spread betting strategies have a 50% to 80% inherent limitation in profitability! That’s why CFDs win hands down over spread betting, even if one has to pay 15% or 30% tax on the profits. With spread betting the trading game is easy and straightforward, but traders don’t have to ever worry about taxation because there won’t be any serious profits made.

Online CFD Trading Wins Hands-down over Spread Betting

When it comes to serious trading, and the need for consistent profitability, CFDs win the argument. All beginner traders are slowly finding out that spread betting is like child play. Spread betting looks appealing only to naive beginner traders. As traders learn more and more about the markets, they realize that CFDs are a much better choice. Even when faced with hefty capital gains tax on profits, CFDs are still better! Because the strategies used cannot possibly be nowhere near as good through the use of spread betting. Capital gains tax maybe as much as 30% in some countries. And yet, the unique edge of CFDs allows for profitable trading. Spread betting is quite inefficient, due to its poor, non linear pricing. So much so, that most trading strategies suffer 50% to 80% reduction in their profitability. Hence, it makes sense to trade through fast and reliable CFDs and pay even 30% tax on profits. Rather than have half the profits, and pay no tax at all. Day trading especially, is almost impossible to do through spread betting. And in most cases, spread betting works well when trading with few pennies or few dollars per point. But as soon as the trader goes above $10 per point or trades faster, liquidity and delay problems hinder proper trade execution. CFDs are extremely efficient up to $100 per point, a limit which most retail traders never have to reach.

Amateurs and Serious Traders

Online CFD trading has been chosen as a smart trading tool, by even stock option traders and hedgers. Exactly because part of their complex trades needs to be perfectly linear, and to offer very low dealing costs. CFDs have much lower dealing costs than spread betting, because the spreads are tighter. And dealing costs are lower than those of option too. More importantly though, it is linear pricing that makes CFDs second to none! No other derivative trading instrument is as linear as CFDs. A good CFD trading system will always take advantage of this superior linear pricing. Especially in choppy, small range market conditions, where it is often totally impossible to profit through spread betting or options. The CFD trading risks are no greater than those of direct market access trading. And simply the inability to predict market price movement. Except that CFDs offer better liquidity than even direct market access trading, and no dealing restrictions are ever imposed. Amateur traders however can still lose, no matter how they choose to trade. Amateur traders will typically lose money even through CFDs, and will blow their accounts within 6 months. That’s because trading and risky and difficult. But if they are successful in predicting the markets. Then CFDs will offer at least twice the profitability that spread betting can offer, on the exact same strategy!

How to Build a Trading Plan through Online CFD Trading

Online CFD Trading offers the potential for many different strategies. Anything from directional, to partially directional and even insured, hedged trading.

Online CFD Trading is Versatile and Dependable

Online CFD trading is very versatile because of its unique benefits. As it allows traders to profit from even tiny moves in the market, in almost all volatility conditions. Brokers facilitate high quality trading through their CFD trading platforms. And the kinds of traders that use CFDs range from careful, patient as well as impatient beginners to more advanced traders. Including even very sophisticated hedgers. The potential of CFDs together with the potential of a good but not necessarily very good strategy, leads to success. Traders only need to be right on direction about 50% of the time, or even less. And they can still trade for a living. Except that trades need to be larger, better focused and calculated. So that winning trades yield a 10% or 20% gain. And losing trades are identified early, and are either closed or hedged against. There is no need for ultra low risk-reward ratios, and such nonsense that many trading experts will have you believe. What is really needed in wise CFD trading is a realistic approach, going for the low hanging fruit. Which is that 10% or 20% profit per trade. And even these trades may require market exposure of more than a single day. Therefore the myth of overnight market risk should also be avoided.

How to Build a Solid, Safe Trading Strategy

New traders, as well as former losing traders need to focus whilst taking trading lightly. And they should refrain from having the urge to win there and then. An early good strategy can be based on trading from Tuesday through to Friday. By not trading on Mondays, it helps traders stand on the sidelines while the accumulated market volatility plays out on Monday. Following the two days of weekend. Where there may be a divergence between market price and the price that market participants want to see. Traders should pay attention to active market trading hours. It makes no difference what market they choose to trade. They should aim to hold trades overnight, and for at least some decent profit. Confusion and volatility are to be expected, so a kind of plan B trading idea must be on standby. So that unidentified losing trades can be temporarily hedged, until excessive uncertainty goes away. This requires maintaining sufficient funds in the CFD trading account. And also avoiding the desire for putting too much money in a single trade. Typically, the market tends to go where you might expect it to go. But only after moving against you for few days and by a good price margin. And this is where another classic tip is called into question. That of never adding to a losing trade. As with all things, the financial markets are not black and white, so black and white trading tips are not useful. In many cases you actually have to add to a losing trade. Moreover, online CFD analysis on the market in question, can help hedge the losing trade very well, and lock the open loss.

Online CFD Trading
Beware of gaps in the markets. More often than not, market price will attempt to revist a gap. And the gap itself will be tested, it will either be filled or not. Sometimes the move can be significant, resulting in false signals on indicators and moving averages, even though the daily trend has not changed. Losing trades caused by weak, suspected gap-chasing action should be hedged against, or at least be reinstated after intitial closure, and even increased in size, at the new and better market price, because the old trend will soon resume. If the gap-chasing action is in the direction of the daily trend, profitable trades should closed in time, before the market reverses.

How to Identify a Losing Trade and Deal with it Early

Online CFD trading can be enhanced much further if one uses notional stops in the time domain. Probability dictates that if it takes too long for a trade to become profitable, then likely, it never will. And should be closed even if the trade is at break-even or at partial profit when the notional time stop has elapsed. The trick is defining the exact time period past which a trade should be seen as a loser. And this can be inferred from studying past daily charts and volatility. In the case of week to week trading. A trade may be a deceptive loser for many hours to few days, and then turn around. But most markets actually do have time limits of around 3 to 5 trading days. So a losing trade which is one day old should be temporarily hedged against or checked again more thoroughly. Whereas a losing trade older than the perceived time limit, say 5 days, should be either closed or maybe hedged for much longer. The exact action required depends on what the daily chart suggests about market direction. And in most cases carefully selected notional stops in the time domain do help in closing losing trades very early. Then there are trades which harder to identify, but a closed losing trade can always be opened again, at a much better market price. Online CFD trading can be dramatically more profitable through these methods for dealing with risk.

How to Make Money in Online CFD Trading

Online CFD trading is not inherently less risky than other instruments. But it offers much better efficiency. If used with boldness and skill, it makes money!

Online CFD Trading Can Make Millions over Few Years!

Online CFD trading can indeed enable wise traders to make millions. Gradually over few years. This is because the efficiency is so good, that profitability is maximized. And not only on profitable trades. But CFDs make it possible to hedge losing trades, and minimize the losses. In ways that other instruments never really can. In the hands of a beginner trader, you will likely see no success with CFD trading. And you will definitely not see any profitability with any other instrument, such as futures, options or spread betting. This is because beginners make all kinds of mistakes. And even the best beginner traders tend to make money trading from Monday through to Thursday, only to lose it all on Friday. Markets are harsh, unforgiving, and offer no easy way to making millions, period! But wise traders have been through long and painful learning curves. They are able to predict around 30% of market direction. And so they are able to make money consistently. Their profitability is much higher when trading through CFDs. At least 50% higher, in the majority of cases. And in some cases as much as 80% higher! This is because most markets moves are small in magnitude and futures, options and spread betting all fail to fully capture the move. CFDs capture every penny from start to finish, because they have the most linear pricing. Online CFD brokers make this possible through the infrastructure and the way they operate.

Online CFD Trading
The biggest single secret to sucess and to making millions is staying motivated. Trading tips and methods that are lame, poorly defined, and not easily actionable are as good as useless! You cannot possibly make millions in CFD trading, while trading out of a sense of duty and boredom. Even if there is such a way, it will be an unpleasant one. Motivated trading and strategy development, require taking an active interest in the financial markets. Commodity markets and level 2 stock information, are two interesting fiels to explore. Because every commodity is so unique, and because there is a lot to explore. The depth of this market data is not fully understood by any single trader! Making millions on the other hand, is not a ridiculous goal to pursue. It is very dififcult to become a billionaire, perhaps nearly impossible. But to make 1 to 5 million dollars over few years is realistically possible, even by trading CFDs at no more than $30 per market point, which ensures always getting the CFD benefits.

Predicting the Markets for Online CFD Trading

Profitable online CFD trading requires having a relaxed mindset. And also being a specialist. Commodities, as well as commodity related stocks and currencies are the best markets for beginners. Commodities are easier to predict because there is only as much supply as the producers can put out. You cannot print more of any given commodity to meet rising demand. You cannot replace one commodity with another. Whereas with many currencies and stocks this can happen. Commodity prices are determined by supply and demand. And if supply is known, which in most cases it is. Only demand is left to assess. In the case of crude oil and gold, rising long term demand helps increase supply. Because rising prices make it economically viable to extract crude oil and gold, from hard to reach reserves. This fundamental force of demand, is always present. And the week to week trend in the market will sooner or later align with the direction of demand. Beyond all this, a new trader has to become a commodity specialist, and dig deeper into the inner workings of a commodity market. And this is the easiest possible way to making serious money. Every online CFD course deals with some market, which is more or less impacted by some commodity.

Go for Trades Lasting Few Days or More But Pay Attention to Market Makers’ Actions

Traders seeking to make money in online commodity trading through CFDs, should focus on day to day trading. And not exclusively on day trading. But there is nothing stopping the trader from combining commodity stocks, and level 2 stock trading. By choosing commodity related stocks, and then seeking clues for breakouts. In the level 2 quotes, many false price movements and fake trends can be avoided. Usually, the commodity in question will move first, and the impacted stock will move somewhat later. If the stock however is very strongly correlated to the commodity price. Then the two markets will be moving at the same time. The commodity market always carries more weight. And will provide clues as to where the related stock is likely to go next. Level 2 information can help reveal the actions of the market makers, and their true intentions. CFD traders trade these stock price movements very efficiently, and when the underlying trend becomes clear. Every counter trend move on the stock, is a golden opportunity! This is how it is possible to make consistent profits, week after week. The task of working with level 2 data is a little bit difficult, but is also much more interesting than the typical, weak and often ambiguous classic price charts.