Regulated Forex Brokers
Choosing the right Forex Broker is a hard decision to make. Most of them have different features, capabilities, weaknesses and advantages. But the first question that should come in your mind should be - “Is it a regulated forex broker?”
The regulated forex brokers are forced to keep the transactions transparent with documented financial reports as they must submit those reports to regulatory authorities. And when they fail to do it, authorities have the right to fine them or terminate their membership. A regulated forex broker allows the resolution of any dispute increasing the investor protection.
Your regulated forex broker will ensure the safety of your money. You also get a chance to file appeals in the case of bankruptcy. Moreover, a regulated forex broker firm will also ensure that there are least possible problems with the trading platform, which it offers to its traders.
To find out a regulated forex broker, first you need to find out what country the broker is registered in. Some countries may have flexible laws for regulated forex traders. Your brokers must be regulated by the local regulatory authorities.
For example, the brokers in the U.S. must be regulated by the National Futures Association (NFA) and Commodity Futures Trading Commission or CFTC; Swiss based brokers must be regulated by the Swiss Federal Department of Finance or FDF. These regulatory authorities protect the public against fraud, manipulation, and abusive trade practices.
The regulated forex brokers are accountable to the authorities. They have specific regulations to follow. For regulated forex brokers, most of the information is available online and you can easily find out their past performances.
From NFA website you can also find out whether there were any serious issues that the clients or the regulating authorities had with the broker in the past.
You can verify the CFTC registration and NFA membership status of your regulated forex broker firm or individual and check for their disciplinary history by the websites or phone numbers. Among the registered firms, look for one with clean regulatory records and solid financials support. Do stay away from non-regulated firms!
Recently NFA has published a brochure called "Trading in the Retail Off-Exchange Foreign Currency Market” for educating investors about retail forex trading. You can consult this before selecting your regulated forex broker.
The NFA also have an Interactive Forex Online Learning Program explaining how retail forex contracts are traded, the risks inherent in forex trading and steps individuals should take before opening a forex account.
Finally, before opening an account even with a regulated forex broker, make sure that the broker will provide you with the backing. If the market collapses, they have the reserves to cope with it and will be around when you decide to withdraw your cash.
To discover which regulated forex broker we have tried and tested and give our full backing and recommendation to please click here
Back to Articles Page
|
