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Why Do I Need a Forex trader?

Discover advantages of Forex trading through a broker

 

Forex is based on currency exchange. This service can be accessed offline, but benefits brought by brokers are undeniable. Here is why you need one.

 

The daily turnover of the currency exchange is 6+ trillion US dollars. This market, once open to the chosen few, now welcomes everyone. Individuals trade currencies alongside hedge funds and major banks. Retail trading is popular in Nigeria and abroad. But is brokerage indispensable?

 

To answer this question, one needs to understand the nature of Forex brokerage. These companies connect you to the global market. Without a brokerage account, trading apps are useless. Although the middleman charges a fee, the value is undeniable. Here is why.

 

 

Trading Without a Broker

 

Forex trading is a process of buying and selling foreign currency. This means that any traveller who buys Euros for a trip to Paris participates in the exchange. You can buy and sell the same currencies in your local bank. Some banking apps allow remote exchange operations. This is possible but less convenient than broker-assisted trading.

 

Should you cut out the middleman? It may be a tempting thing to do. After all, brokers profit from every Forex trade. ECN firms charge a commission, while market makers set their own Ask and Bid values. Still, once you try the full range of their services, you are likely to become their client.

 

Through brokers, retail traders (i.e. individuals) connect to the global over-the-counter market. This means that there is no centralized physical exchange. Buyers and sellers connect online, and trade using real-time quotes. Until the 1990s, this market was only open to institutions. You need a broker…

1.  To Use Cutting-edge Platforms

 

Day traders open and close positions several times a day. Can you imagine doing it offline? Forex platforms are packed with visual aids that facilitate analysis. Thanks to VPS, they are also protected against technical glitches and power outages.

2.  To Access Forex Education

 

You may be overwhelmed by the abundance of information on the subject. Fortex is wildly popular in many countries. Google ‘Forex’, and you will see countless videos, articles, podcasts, and books. Which of them are reliable?

 

It is best to ask a trusted Forex trader for recommended sources. Official sites have special sections with strategies, tips, and links to more information. Today, anyone can be a blogger. Seek guidance from renowned experts.

3.  To Open an Account

 

An important element of learning is demo trading. The theory is useless without practice. Before risking their money, clients may use a trading simulator. Demo accounts are easy to register, and they are offered by all trustworthy brokers. Enter your login and password on the platform, and explore it in the safe training mode.

 

Trading systems like MetaTrader 4 and MetaTrader 5 can be used in both demo and live modes. Learning is completely free, and there are no time limitations. Rookies can see what real trading looks like, use controls and risk management features, etc. Demo practice is irreplaceable.

 

Clients who sign up for a demo have no obligation to make a deposit. Thus, you may test trading terminals from different brokers, and choose the firm you like. Once you switch to the live mode, real trading can commence. As financial operations are also processed by the broker, perceive it as your virtual banker.

4.  To Use Leverage

 

Clients of Forex brokers like ForexTime can trade on margin. This means they are allowed to open positions which are worth more than their investment. For example, someone with $100 in their account may trade $10,000 if their leverage ratio is 1:100. In essence, the broker lends a portion of their funds to boost your buying power.

 

High returns on Forex are possible in two situations: when trading highly volatile pairs, or trading large volumes. You do not have to deposit a fortune to access big-size trades. This benefit is unattainable without a brokerage.

 

There is a catch. Higher volumes translate into higher risk. Unfortunately, high return — low-risk investment does not exist. This is true inside and outside Forex. Therefore, traders are encouraged to trade without leverage until they gain sufficient confidence.

 

5.  To Access Different Instruments

 

Forex pros do not limit their trading to a single pair. A diverse portfolio is essential for effective risk management. Aside from Stop Loss for every trade, clients should consider engaging other instruments. Global brokers like FXTM offer different options:

 

  • currency pairs,
  • CFDs on commodities;
  • CFDs on stocks;
  • CFDs on cryptocurrencies;
  • precious metals trading;
  • Stocks;

 

 

 

Value of Forex Brokerage

 

 

Professional Forex traders cannot work without a brokerage. Such companies provide a broad range of services, from account registration to support transaction processing. Reliable brands, both ECNs and market makers, provide undeniable benefits. Clients may trade via high-end platforms, access leverage, receive support, etc. Thus, if you want to make Forex your source of steady income, choose a trusted broker first!

 

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