Is your Broker really the problem?

August 17, 2014 by  
Filed under Forex Advice, Forex Articles, Forex Tips

Is your broker really the problem?

I’m sure many traders out there have accused their broker of swindling them from their hard earned cash at one point or another. I know I have on many occasion. I have had the privilege to work with some of the world’s largest forex providers, and now that I have been on both sides of the fence I have a very different opinion. Firstly, they’re not in the business of ripping people off. This is just a fallacy. I completely understand why people may think this, as I know there have been times when I’m in a trade and for the life of me can’t work out why the market automatically defaults to going against me. While this does happen all too often, it really is not the provider doing this. Think about this for a moment; why would a provider try to manipulate the market for one or two clients? Unless you are trading with many millions of dollars, it would be pointless for a provider to do this. How could they provide multiple prices for their clients?

Another one I used to hear clients mention is; How come provider ‘x’ has different prices than you? Here in lies some of the issues with trading the forex markets. Unfortunately, as there is no fixed exchange to trade through, the liquidity providers that various forex providers use may differ. In essence what this does is create a market that looks similar, but could be multiple pips in difference to the next.

I started questioning myself after I had a few losses with a particular provider. I actually assumed that due to their spreads being somewhat wider, then perhaps that was my issue. Needless to say I changed brokers. The same thing happened at my next provider, and so forth until I eventually decided to take ownership of it. It was when I decided to take full responsibility for all my results that things started to change. Of course there will always be times when a provider is at fault, or the market does something unexpected, and closes you out at the wrong price. What I am alluding to is that when you take responsibility for your actions, you can start to realise that it’s not ‘me Vs them’ anymore, but quite simply ‘me Vs me’ in trading. Taking responsibility is the first step. I have now traded with some brokers that have extremely wide spreads, and still made money; conversely, I have traded with some others with tight spreads and not done so well. In essence, every provider has both their good and bad points, and at the end of the day it is a matter of you finding what works for you. When you take on the mindset that you could potentially lose, or no matter what happens with your provider, you could potentially win, then it changes your frame of mind. You are more emotionally in control as you are not expecting anything other than you trade to be executed. When you adhere to good risk management, understand that it is you, and not your provider that is responsible for your results, then you can start to create positive outcomes in your trading.


October 8, 2012 by  
Filed under Featured, Forex Articles

While there are many investment vehicles to put your money to work these days, none are as large, and potentially as lucrative as the foreign exchange markets. With a daily turnover of over $1.4 Trillion! (yes you read that right…daily). Needless to say it offers a freedom that many other markets just cannot compete with.

Along with the fact that it is a huge market, it also comes with a stack of other benefits…

Open 24 hours on weekdays, the fx market gives you the ability to trade any time of the day or night. Compare that to other markets that operate at specific hours of the day, the forex market is a buzz of activity and opportunities throughout the week. Investors can react to specific news events and trends that happen within the week, anytime.

This also gives traders another type of freedom. The freedom to choose where you work, and when. This has allowed many new traders enter the market that may work during the day. If you have a laptop, then you can trade no matter where you are!
Less Cost
Due to the size, and daily turnover of the fx market, and the fact that it is traded electronically, the costs of trading are far less significant than trading normal equities (shares/stocks). The majority of fx trading cost is built into the opening spread (the difference between the buy and sell price when you enter the trade). The spreads here are usually smaller than the spreads in other markets, which again makes the ability to earn a profit much easier.

Unlike other markets where leverages are small, forex trading allows for bigger leverages, giving you the chances to trade (at times) up to four hundred times your investment. Of course, like any investment of this nature, leverage also carries a significant degree of risk. Thankfully with the forex market in particular you can easily manage your risk. At times risking only a handful of dollars per trade in order to place your trade.

Stable Price
Since your trade is executed immediately, your trades are done with precision, and you have less risk that the prices will slip if you set up orders to enter at specific prices. Due to the rapid nature of the markets, you can be in and out of a trade and not have your funds tied up in the markets.

With the speed, liquidity, and popularity of the fx markets this also means that the market moves in predictable patterns. This means you can formulate a trading plan based on these repeatable patterns, and ensure you can predict the market with a certain level confidence and consistency.

Stable Profit Chances
Since your trading involves two currencies and not other markets and trends, one always has the opportunity for profit. There is no bulldog watching of rising or falling of markets, goods and industries. Whether the market is bullish or bearish does not really need to worry you. What really matters is that you pick the right currency to trade.

Forex trading is considered the perfect competition for logical reasons. Everybody is presented with an equal playing field. Even if the currency is falling, it just means that there is currency rising somewhere and the opportunity of profit exists. An unlimited earning potential, the freedom, and the even opportunity makes the foreign exchange market an exciting opportunity for anyone.