Many new forex traders have made some grave mistakes when choosing their broker. This has led them to huge losses over time making them lose faith in the system when they could have stuck it out with a more reliable broker and made better trades. Some of the mistakes are:
Not verifying the spread: Some brokers offer “AS LOW AS” spreads. This means that the spread is not fixed and could go as high as 40 pips in turbulent market conditions.
One PIP Spread: Here again it is virtually impossible to execute a trade with a one pip fixed spread. They should have made a list of the brokers offering a 2 PIP spread and then picked the best.
Trading Platform: The broker offered an unreliable online platform. Use the ones with the Meta Trader or other proven platform.
Execution: the broker never had instant execution even though they promised that. Trade orders go unfilled possibly at a loss to the trader.
Support: unreliable support led to losses as stop loss orders were not executed and support could not be contacted to close the position.
Not verifying if the broker was registered or licensed is another factor that could lead to an investor losing money to a broker that can disappear overnight. Check with the financial authority such as the NFA before signing up with any broker.
