The global foreign exchange market trades over $4 trillion every day, which makes it the largest financial market. Despite such high capitalization, the forex market has no central marketplace, and traders must open an account with a broker so as to access the market. As the forex market grows, so does the number of brokers increase. This makes it hard for a trader to find a professional broker, especially for large accounts. In this article, we will look at the major considerations every trader should make when choosing a trusted forex broker for large accounts.
It is important for traders to understand that not all retail brokers can support high volume trades. In fact, some brokerages incur great losses or go insolvent when investors trade with huge sums of money. As an advanced, or let’s say big league trader, you need a broker who will help you get the best value for your money. Here are some parameters for picking a reputable broker who will offer great service.
5 Tips For Choosing a Best Forex Broker for Big Accounts
1. Account Type
The ideal forex broker for large accounts has separate types of account and trading conditions specifically for this purpose. Forex traders in this category deserve the best- great bonuses and benefits. Additionally, do not forget to check the broker’s leverage, commissions, spreads, initial deposit, transaction costs and ease of withdrawal. The best brokers have policies that will help traders meet their investment goals with ease.
2. Regulatory Compliance
Forex traders opening large accounts should be careful enough to verify the broker’s regulation status. It is very risky to commit thousands or millions of dollars to a broker who does not maintain trading standards set by regulators. For transparency and safety of your funds, check whether your broker is registered with the right regulatory authorities in your region. For instance, those residing in the United Kingdom (UK) should check whether the broker is a member of FCA, Financial Conduct Authority. A duly regulated firm always protects its clients from fraud, market manipulation, and other unethical practices.
3. Type of Trading Platform
The trading conditions a particular broker offers determines how fast a trader succeeds. As such, large account holders should trade on platforms with direct market access. This is because most of them can deal with liquidity providers and big banks directly. Direct interbank trading ensures transparency and minimizes chances of requites or price manipulations. Large forex account holders should, therefore, check to ensure the broker’s platform is professional and has fundamental analysis/technical tools for high volume trading. A feature-rich and user-friendly website is visually pleasing and easy to use. Conversely, a poorly-designed platform could potentially lead to losses.
Apart from checking a broker’s regulation status and trading platform, traders should be diligent enough to check the financial state of the broker. Notably, some of the best brokers for large accounts have been challenged with negative balances on their clients’ accounts in the past. The question of insolvency rises when a company is not capitalized enough. Therefore, investors should ascertain the financial status of their prospective brokers before setting up a trading account. Take your time learning about a forex broker, including their risk mitigation strategies. You do not want to end up worrying, or maybe waiting for a liquidation of the firm so as to get back your hard earned money.
5. Account Segregation
The best forex brokers allow large account holders to withdraw their earnings directly from segregated accounts. Although this feature is not available on most forex platforms, it is an added advantage to traders with large accounts.
Other factors to consider while choosing a professional forex broker include order entry types, customization options, automated trading options, trading alerts, strategy builders, research materials and level of customer service.
The Bottom Line
Every trader ventures into the forex market with high hopes of growing their money. It is therefore important to choose a forex broker who can sustain your account valuation, as your trading ability transits from a standard market maker to a large account. Investing with a professional currency trading broker gives you confidence, such that you can devote more time to developing more effective trading strategies. Conducting enough research before depositing your money with a forex broker is very helpful, and can increase your chances of success in the highly competitive forex market.