Trading forex through an online broker is now easy and affordable for most people. Over the years, the number of online forex trading platforms had grown. This has offered different forex traders the chance to choose the best online broker for their needs.
Even so, a disadvantage in the growth of online trading is that there are some brokers who are out to make quick money and thus don’t have your needs at heart. To ensure that your funds are invested wisely, it is important to take time when choosing an online broker.
Here are critical factors to consider when choosing an Australian online forex trading broker.
Client funds and licensing
When choosing an online forex broker in Australia, you need to go for one that is registered under the ASIC (Australian Securities and Investments Commission). Before you deposit your funds in a forex account with the broker, you also need to confirm that they have an AFS (Australian Financial Services) license number.
To check whether the broker is licensed under AFC, you can use the ASIC professionals register. This is a search facility that allows you to check details of any online forex broker or financial service organizations.
It is important to also confirm about the bank where the broker says your finds will be held. You can get this information through the broker’s website. This is information that should be made available in the PDS (products disclosure statement).
Ease of use of the trading platform
If you are new to online forex trading, the best broker will ensure that their platform is easy to use. Most new traders find the process of placing orders, viewing positions, obtaining reports or data tedious. Therefore, a good broker knows this and created a platform that makes these processes easy. An online trading platform is a tool that should offer support and assistance during your trading process.
Therefore, it needs to be very easy to use.
Most online trading platforms such as Rakuten online trading platform offers demo accounts. These make it possible for traders to create accounts and test out the platform before they switch to live accounts.
Fees and commissions
One common difference between online forex brokers is the financial instruments they offer. Even so, you may not necessarily be interested in all the trading products on offer. Write down the markets you may be interested in trading and compare transaction fees from different brokers. Pay close attention to the commission charges for each market you are interested in.
Besides the execution charges, there are other hidden charges you need to look at before settling for a broker. These include:
• Account inactivity fees
• Account closure fees
• Statement fees
• Funds transfer or withdrawal fees.
Ensure you consider all these costs and how they will affect your finances on a month to month basis.
Minimum deposits and opening balances
Different online forex brokers require different amounts for minimum deposits and operating balances. There are brokers who will charge low first-time deposits limit while others may require amounts that exceed 100,000 dollars. Learning about this information will save you the hustle of filling out registration forms and going through the entire registration process only to realize that that was not the broker site for you because you can’t raise the deposit required.
Placing phone trades
By design, online brokers are mostly available for individual traders or investors. The broker offers a platform where individual traders can place trades and monitor them. This means that the cost per trade is lower than they would be when using a full trade service broker. Even so, it is important to confirm that your broker will allow you to place orders, update orders or close trades through phone calls. If they offer this service, you also need to find out if they charge extra for it.
A broker who allows you to trade via phone is the best choice for your trading needs. This is because sometimes doing it via the online platform may not be possible due to various reason like power outages or computer system functionality issues.