Find the best Forex Trading broker for you in 2022

Consider Your Needs

Before looking at brokers, assess your own needs. Here are some things to consider:

Are you going to day trade a lot or a little? Trade very small moves, or capture bigger moves? If you day trade a lot and capture small moves, consider an ECN broker. You'll pay a commission on trades but the spreads are much tighter, which matters when trading small moves. Search only for "ECN Forex Brokers."

If you don't think you'll need an ECN broker, then you still have a big pool of potential brokers left.

What the Broker Should Offer

Now that you know what you want, and have hopefully narrowed the list of potential brokers, look for the following in the brokers you're still considering.

No "dealing desk." If you're a day trader you want to be interacting directly with the market, and not sending your order to a trading desk which then initiates it in the market. That takes too much time, and often results in "re-quotes." This is when the price has changed since you placed your order, and the broker asks you if you wish to proceed. Because of the time delay, your trade opportunity is likely gone.

Be Wary of "Losing Trader" Reviews

Part of your research in choosing a broker should be looking at written reviews of the broker as well as discussion forums.

Be wary of these though. Unless the information comes from a credible source, and most forums are not credible sources, you're likely to find fake reviews, both positive and negative.

Most day traders will lose money, and since most traders can't admit that to themselves, they blame others when it happens to them. Just because someone complains about losing money doesn't make the broker they were using bad, even though the writer may blame the broker.

What the Broker Should Offer

Your list of potential brokers should be smaller now. But with so much false information out there, don't make a decision yet. Instead, test out the brokers you are most interested in.

First, open a demo account and take note of the trading conditions. Your orders should execute instantly. Spreads should be tight and the platform stable, not crashing all the time. If the demo works well for several weeks, then open a live account, with a fraction of the capital you intend to deposit. For example, if you have $10,000 to deposit, start by only putting in $1,000.

Avoid "Bonuses"

When you open a live account avoid any and all "bonuses" the forex broker may offer. Here's an example: "Open a $1,000 account and get $100 in bonus cash!"

Nothing really comes for free. If you accept a bonus it may interfere with withdrawals, because some of the money in your account is now the broker's money. Send an email with your account application that explicitly states you don't want to take part in any bonuses that they have on offer.