How to get a forex broker

If you have decided to invest time and money to become a forex broker, the following information will help you get started. 1.

Company registration – $2000
2. Opening a corporate bank account – $500 – $3000
(to be noted that larger banks might require a minimum account balance (deposit) to be made and maintained throughout operation. The amount can vary from $50,000 to $500,000 USD).
3. Opening a physical office (if planned) – $10,000 – $30,000
4. Developing a website – $1000 – $25,000
5. Choosing a trading platform – $5000 – $150,000
(MT4 platform license would come around $100,000 – 150,000+/year. While IB/white label solutions could result in guide to broker-dealer registration by U.S. Security and exchange commission (SEC) fees).
6. Hiring staff (support, IT, legal, other) – based on your local salary rates

How to become a forex broker

If you have decided to invest time and money to become a forex broker, the following information will help you get started.

Your new brokerage company set-up plan would include:

1. Registration of your company in a local or offshore jurisdiction.
2. Application for a forex broker license at the U.S. Security and exchange commission (SEC) if you plan to do business in US.
(if you want to open and operate outside the US, request an information kit from your local financial authority).
3. Opening a bank account within the jurisdiction to collect funds from clients.
4. An application for receiving online payments, if you’ll be accepting online funding.
5. Preparation of legal documents, including dealing manuals & agreements, anti-money laundering policies, conflict of interest policies etc.
6. Pay registration fees and meet a minimum capital requirements for opening a brokerage business (broker-dealer applicants and registrants must have and maintain the minimum net capital required by securities and exchange commission rule 15c3-1 and comply with SEC rule 15c3-3 governing customer protection, reserves and custody of securities).
8. Find liquidity partners, clearing company(s) that will clear your trades. (A clearing company will look for your to deliver a certain trading volume per month: e.G. A total amount of lots your clients will be able to trade each month).

Every step will include a set of documents to be prepared as well as qualifications to be passed. The package of requirements will depend on a jurisdiction where you choose to register a company.

Registrants must be prepared to pass thorough background investigation, pass examinations on general securities principles and state securities laws (NASD series 7, NASD series 63, 66). Among others, the following criteria are considered during registration application:
– financial solvency;
– conviction of a crime;
– evidence of past inequitable or fraudulent business practices in the sale of securities.

Guide to broker-dealer registration by U.S. Security and exchange commission (SEC)

Forex brokerage roadmap (pfd) by boston technologies

Approximate costs of starting own forex company

1. Company registration – $2000
2. Opening a corporate bank account – $500 – $3000
(to be noted that larger banks might require a minimum account balance (deposit) to be made and maintained throughout operation. The amount can vary from $50,000 to $500,000 USD).
3. Opening a physical office (if planned) – $10,000 – $30,000
4. Developing a website – $1000 – $25,000
5. Choosing a trading platform – $5000 – $150,000
(MT4 platform license would come around $100,000 – 150,000+/year. While IB/white label solutions could result in $0 fees).
6. Hiring staff (support, IT, legal, other) – based on your local salary rates

White labels and ibs

If you aren’t ready to buy your own trading platform license, you can start with an IB or a white label solution from a prime broker (your clearing company).

As a white label you’ll be offering trading services under your company name.
A prime broker will customize the interface and platforms for you, so that you’ll be running under your own logo.
Your prime broke will also arrange a trading server for the platform and clearance of all clients’ trades for you. You can also leave the handling of deposits and withdrawals for your prime broker, so that all you need to do will be: marketing (to bring new clients) and customer support (to keep those clients).
As a white label you’ll be able to customize your own fee structure and dealing spreads to earn higher income.

As an IB (introducing broker) you’ll be sending/referring all clients to your prime broker, where they will eventually open a trading account. As an IB your goal will be to refer as many clients to your prime broker as possible, because it’ll directly affect the income stream (commissions) you’ll earn for each referred client.
For this type of business you’ll need no licensing or registration. All you’ll have to do is find and refer clients, which can be done via any website (most common way), word of mouth, including conferences and seminars, by utilizing own existing client base etc.

How to get a forex broker license

If you’re new to the forex industry and are interested in starting your very own forex brokerage, one of the foremost considerations you will encounter is forex licencing and the process of applying for and obtaining a forex licence. The forex industry, particularly from the broker's perspective, is challenging yet exciting at the same time. For brokers however, it is particularly challenging as legal and regulatory burdens typically fall upon the shoulders of the brokerage.

Let's make this crystal clear at the onset: there is no easy or “magical” process to becoming a licenced brokerage. There will be plenty of tedious paperwork and multiple meetings with regulators. There will be application fees and licencing fees. However, these difficulties are miniscule compared to the return on investment. Possessing a forex licence will have an immeasurable positive impact on the operational and financial success of your forex brokerage.

The A-Z of forex licencing

As you start to build your forex brokerage, you need to decide on a country or territory in which you will incorporate your business. The physical location of your offices does not need to be the same as the location in which the brokerage is incorporated. It is important to note, however, that the location of incorporation will affect the licencing process.

Although every country has its own legal framework and regulatory agency, the most popular jurisdictions in which forex brokerages are regulated are usually in countries with world-leading economies such as hong kong, the united kingdom and australia. Possessing a licence issued by the regulatory agency from one of these jurisdictions, for example an SFC licence or an FCA licence, evokes a sense of trust and reliability from traders, elevates the appeal of your brokerage to them and opens the door for a wider and more lucrative client base. Furthermore, possessing a forex licence eliminates some hurdles when opening a bank account for your brokerage.

Obtaining a forex trading licence in these jurisdictions often involves large sums of fees and other administrative charges; as a result, licensure in these jurisdictions may not be suitable or realistic for many new forex brokerages. The following reputable, reasonably priced options have been recognised as a popular workaround.

The cyprus securities and exchange commission (cysec) is one of the leading jurisdictions for forex brokerages, due to cyrus being a member of the european union, allowing brokers to offer products and services to residents of all EU countries. Additionally, low corporate taxes and a thriving financial sector make it one of the best jurisdictions in which to begin your journey in the world of forex trading. The cost of a cyprus investment firm (CIF) licence ranges from €40 000

€100 000, and the application process takes around six months.

The malta financial services authority (MFSA) is another popular option for forex licencing and regulation. Malta has been established as a forex-friendly business environment due to reliable regulatory frameworks in addition to its european union inclusivity. Capital needed for an MFSA licence is approximately €730 000.

Offshore forex licensure

Cheaper options such as a seychelles forex licence (financial services authority), with an application fee of only $200, do exist for brokers with less capital or different priorities, who can choose to incorporate their company in an offshore region. These jurisdictions usually have lower requirements on capital as well as more relaxed regulatory demands. However, jurisdictions such as these, along with the regulations and licences they provide, are less prestigious than those mentioned previously. As a result, it may be more difficult to attract certain traders with a licence from these offshore regulators.

The licensure process is a critical procedure that you will undertake when you establish your forex brokerage. This process requires significant time, resources and dedication. Many brokers with industry knowledge opt for an easier, more straightforward method through which to enter the forex industry. A reliable forex broker turnkey will handle the entire brokerage setup process, including the regulatory and licencing procedures.

The easiest, most reliable option

A forex turnkey solution is the intuitive industry insider’s “key” to getting a new forex brokerage business up and running in a short amount of time minus the significant expenses, setup and licencing complexities. It is a significantly more cost-effective and time-saving way to let your forex turnkey solution handle the groundwork instead of managing the entire process singlehandedly. You, yes you, can bypass all of these speed humps by choosing industry-proven doo clearing’s forex broker turnkey solution.

Doo clearing will provide you with all the products and services you need to start your forex brokerage:

- white label MT4/MT5 implementation
- multiple asset class liquidity
- FIX API, MT4, MT5 connectivity
- brokerforce CRM for clients and staff back office
- PAMM/MAM, social trading investment platforms
- landing page
- 24/7 multilingual support
- cost-effective pricing

If getting your own licenced forex brokerage business up and running in just 3 weeks sounds like music to your ears, contact our expert support team.

Wednesday, 15 apr, 2020 / 10:26

Note: company news is a promotional service of the directory and the content isn't created by finance magnates.

WTI crude oil prices posted a rebound following the declines from last week. [. ]

Posted on tuesday, 19 jan, 2021 / 11:31 under

Dollar pulls slightly after yearly high the dollar ended slightly lower at the [. ]

Posted on tuesday, 19 jan, 2021 / 11:30 under

Stocks perk up after slow start to the week as focus turns to [. ]

Posted on tuesday, 19 jan, 2021 / 10:15 under

How to get
a FOREX license

An overview of some of the most popular forex business licenses available to brokerages in 2019, the costs involved, and a more budget-conscious solution.

How to get a FOREX license

If you’re a new forex broker or looking to start a forex brokerage business, obtaining a forex license is one of the first things you will need to consider. While licensing activities require forex firms to follow strong codes of conduct, having a license will impact favourably on the operational and financial success of your business.

Which FOREX broker licenses
can I choose from?

If you’re just starting out as a broker, one of the first things you need to consider is where to incorporate your brokerage business. The physical location of your operations does not need to be the same as your place of incorporation as former involves a completely different set of considerations including aspects like rent, employees and tax, etc. In terms of incorporation however, there are various complexities with attempting to obtain a license which relate to costs, annual licensing fees, timescales, laws and taxation, to name a few.

Although every country has its own legal framework and regulatory body, the most popular forex brokerage jurisdictions tend to belong to the world-leading economies including the US, UK and australia. Having a license issued by one of these country’s jurisdictions, for example, an FCA forex license or an ASIC forex license, brings a higher level of trust from traders and will make your brokerage more attractive to them generally, as well as appealing to a more lucrative client base. It is also easier when opening a bank account or merchant account for your brokerage. In this respect, you can also expect to benefit from reduced fees, since being established in these locations is regarded as having a lower risk. However, obtaining a forex trading license in these countries can involve a large amount of capital, making the decision one that may not be within reach for most new brokers. An alternative choice is available with two well-regarded, mid-range budget options that have become a highly popular way forward.

Popular jurisdictions

The first of these is cyprus regulation (cysec). This is one of the leading jurisdictions of choice for forex brokerages, thanks to the country’s EU membership which allows brokers to offer their services to all member states in the european union. This, in combination with low corporation taxes, a vibrant financial sector, and skilled workforce, makes it one of the best places to launch yourself into the world of forex. The cost of a cyprus investment firm (CIF) license ranges between €40,000 - €100,000 with the entire process taking around 6 months to complete.

Malta’s MFSA is another popular choice for regulatory purposes. Malta has become an established business environment for FX businesses, due to a reliable regulatory framework, as well as being in the european union. Capital requirements for an MFSA license are in the region of €730,000.

Offshore FOREX license

Cheaper options such as a hong kong forex license (FSC) also exist for brokers who have less capital or different requirements who can choose to incorporate their company in an offshore location. These jurisdictions usually have lower initial capital requirements, along with more relaxed regulatory demands. Many forex brokerages choose this route although arguably they are less prestigious than the former. For this reason alone, it can make it more difficult to attract a certain calibre of traders.

Nevertheless, if you choose this offshore route, there are many places where you can incorporate for a low cost. The most popular of these include the seychelles forex license (FSA) where the application fee is just $200 with an annual license fee of $1000. A mauritius forex license (FSC) is another popular choice where the minimum net capital requirements amount to little more than $20,000 with license acquisition taking around 4-5 months. Other low cost options include new zealand (FSP) and vanuatu (FSC), each bringing with them, lower costs and more lenient forex rules and regulation.

The licensing process is, as we have seen, a major part of establishing your brokerage business which takes a lot of time and know-how. This explains why many new forex brokers opt for an easier route to enter the forex industry. Choosing a forex broker turnkey takes care of the whole brokerage set up, including all licensing aspects.

An easier option

A forex turnkey solution is a smart way to start a brokerage business quickly, without significant costs and with no setup or licensing complexities. It is a much more cost-effective and efficient way to get started rather than attempting to undertake the entire process yourself. You can avoid all these hurdles by choosing industry-renowned b2broker’s forex broker turnkey.

B2broker can provide you with all the tools you need to get started:

General overview of the money management platform

Major differences between account types

Growth hacking tricks with copy trading and PAMM offers

Fees sharing - a new instrument for IB sales

Content marketing ideas for better retention and conversion

IB referral flexible module: lots, markups, % commission fee

Investment platform (PAMM/MAM/social trading/copy trading)

Trader’s room (CRM) for your clients and a back office for your team

Several connectivity methods: prime XM, one zero, AMTS and FIX API

Single marginal account with liquidity for 800+ pairs

Liquidity for 7 asset classes

White label of MT4 or MT5

24/7 responsive support in 7 languages

Cost-effective pricing (no revenue share model - just a software fee)

B2broker also takes care of all the legal and licensing process, including company registration, connection to a reliable fiat PSP and bank account opening, as well as marketing strategy, education on all technical issues and product strategy.

If you would like to have your own licensed forex business up and running in just 3 weeks, speak with the professionals. Click here to get started!

How to get a forex broker license

The A-Z of forex licencing

€100 000, and the application process takes around six months.

Offshore forex licensure

The easiest, most reliable option

Doo clearing will provide you with all the products and services you need to start your forex brokerage:

If getting your own licenced forex brokerage business up and running in just 3 weeks sounds like music to your ears, contact our expert support team.

Wednesday, 15 apr, 2020 / 10:26

Note: company news is a promotional service of the directory and the content isn't created by finance magnates.

WTI crude oil prices posted a rebound following the declines from last week. [. ]

Posted on tuesday, 19 jan, 2021 / 11:31 under

Dollar pulls slightly after yearly high the dollar ended slightly lower at the [. ]

Posted on tuesday, 19 jan, 2021 / 11:30 under

Stocks perk up after slow start to the week as focus turns to [. ]

Posted on tuesday, 19 jan, 2021 / 10:15 under

Guide: how to choose a forex broker

With hundreds of forex brokers to choose from, selecting the right one can be both challenging and time consuming. To ease the process, we’ve tested and reviewed dozens of the top forex brokers and compiled our findings into thorough forex brokers reviews. But don’t just take our word for it – each forex broker review also includes feedback from real traders, so that you can make a comfortable, informed decision.

The basic criteria to use in choosing a broker are few and simple. Without doubt, your number one priority should be ensuring the safety of your funds. Firstly, this means making sure that the broker you choose will not steal your deposit. You can best take care of this by making sure that you only use a broker based in and regulated by a financial authority in a respected financial center. Secondly, you need to make sure that even if the broker operates honestly, but goes bankrupt for any reason, that you will be able to recover your deposit. One measure that can be taken here is to only deposit with brokers whose regulators offer deposit protection for clients (such as regulated brokers in the U.K. Or australia, for example). This means that even if your broker goes broke, the government will bail you out by paying back your funds up to a certain amount, although it might take some time. Beyond that, try to choose a broker with a healthy financial situation and a good reputation. Once you have taken these precautions, you can look at what your potential brokers offer in terms of range of available assets to trade, spreads and commissions, overnight financing charges, and speed and reliability of trade execution – and make your choice accordingly.

Use the below links to navigate through the guide:

Things to consider when choosing a broker

Regulation, safety of funds & legal issues

Regulation and compliance are - beyond the shadow of a doubt - the most important things to consider when choosing a broker. An unregulated broker can essentially do as it pleases with its traders' funds. Such a broker might be nothing more than an online scam, so it worth being extremely wary of any unregulated brokers.

Regulatory compliance

The activity of a trustworthy broker should always be governed by an official regulator designed to protect and promote the integrity of brokerage operations. All types of abusive practices linked to the sale of futures and options should be out of the question, as traders should be protected against fraud as well as manipulation. A US broker must be registered with the US commodity futures trading commission (CFTC) as a merchant and retail forex dealer. It also must be a member of the NFA (national futures association). These credentials are usually listed in the about us section of the broker's website. Equivalents of these trade associations and regulatory bodies are present in nearly every country in the world. Depending on where their broker is based, traders should always research and look for these credentials. In this respect, it's also worth researching the year when the broker obtained its license as this might carry some significance as well, in regards to the overall reputation and operational history of the broker.

Safety of funds

Regulated brokers must comply with a set of rules that are meant to safeguard investor assets. This is the primary reason why regulation is so important. Every regulated broker is subject to a "net capital rule" which prescribes a minimum amount of capital to be kept in liquid form. This way investors are protected with a 'safety net' in the event that a broker is forced to close. In addition to the requirement of maintaining minimum capital requirements, regulated brokers in most jurisdictions are required to keep all client funds separated in segregated accounts so that client funds won't accidentally (or purposely) be used for any reasons other than to execute the client's trades. Some nations, such as the united kingdom, even offer government-backed deposit insurance for its regulated brokers so that clients can recover part or all of their funds even if the broker manages to misappropriate them.

Select a forex broker by the type of trading platform :

Broker types

The type of broker used can have an impact on one's overall trading performance and results.

Dealing desk vs. ECN brokers

Dealing desk brokers work similarly to the dealing desks provided by various financial institutions and banks. A forex broker who uses a dealing desk and is registered as a retail foreign exchange dealer and futures commission merchant (or equivalent in another country) can offset trades. The no dealing desk system on the other hand offsets positions automatically and then transmits them to the interbank market. Brokers working through a dealing desk system do not work directly with market liquidity providers, therefore only one liquidity provider remains in the equation, and that gives birth to a fundamental conflict of interest.

An ECN broker on the other hand, offers its traders direct access to the other market participants through an electronic communications network. Why is an ECN broker the superior of a dealing desk one spreads-wise? Simple: because it deals with price quotations from several trading entities, it can offer much better bid/ask spreads.

The business model of an ECN broker is an entirely fair one, as it eliminates a major conflict of interest: because it matches trades between various traders, it cannot become the sole market-maker, thus it cannot trade against its own clients. Another advantage of the ECN is that because of the lower spreads it offers, such brokers can charge a fixed commission on every transaction.However, you should not see ECN brokers as a panacea. Under certain conditions, their liquidity can dry up completely, creating much greater slippages than dealing desk brokers’ client might be suffering. Another sad reality is that many brokers describe themselves as of the ECN type, but have an element of dealing desk within their operation, so are not “true” ecns.

Top rated forex brokers

Fees & commissions

This brings us to the third most important brokerage selection factor: costs

Brokerage fees - price isn’t everything

Brokerage fees are fees that the broker charges for the services it offers, which are services focused on facilitating transactions between buyers and sellers. The amount of these fees depends on the broker type, and the type of service to which the trader signs up. For the purposes of retail traders, the situation is best summarized by saying the dealing desk brokers charge spreads only, while ECN brokers charge spreads as well as commissions.

Commissions & spreads (fixed or non-fixed)

The key difference between fees and commissions that all traders need to understand, is that fees represent a flat charge, while commissions vary depending on the delivered financial product and the size of the transaction.

Premium services offered by the broker?

Full service brokers offer all sorts of additional perks and premium features, some of which are indeed extremely useful. Such services do cost extra though. In this respect, what you should be looking for is a broker who includes as many premium services as possible, as cheaply as possible. In the premium service category, we have features like advice and research covering a wide range of traded assets, retirement advice, tax planning etc. You need to carefully weigh whether you need such services or not. If you're only looking to execute trades, there's no point in getting embroiled in any premium-service intricacies. Discount is probably the way to go then.

Does the broker credit or debit daily rollover?

Another factor to consider is daily rollover. The daily rollover is interest credited or debited to the entity holding a forex position overnight, depending on the relative interest rates of the currencies involved in the trade. Positions which are kept open past 5PM EST are considered positions held overnight. In such cases the broker will consider which national currency the trader bought relative to the other national currency of the pair. If the interest-rate difference favors the bought currency, the trader will have rollover interest credited: in theory, at least. If it's the other way around, the interest will be debited. The problem is that most brokers make sure their clients pay for holding most positions overnight, and there is nothing to stop them doing this beyond the true market cost.
Most brokers roll over open positions automatically. It is important to know that the rollover interest (whether it's debited or credited) is calculated on the full amount involved in the trade and not on the margin alone. Another important thing regarding the rollover interest is that it represents a separate revenue stream from the capital gains and as such, it will be taxed separately too, as interest income.

Trading terms

Time to shed some light on the expressions and terms you may have come across within this guide but that haven’t been fully explained until now.

Select a forex broker by country/region

Margin

Through a margin account, the investor essentially borrows from the broker, with the intention of controlling larger positions than he'd be able to control based solely on his own invested capital. There are special margin accounts that traders can use for this purpose. The margin percentage is set to 1-2% in the case of accounts which trade in 100,000 currency units. What this means is that in order to control a $100,000 position, a trader needs to deposit $1,000. Margin accounts come with their own risks, and special operating procedures meant to reduce risk for the trader as well as for the broker.

The difference between margin and leverage is simple. Let’s say a broker requires a deposit of $1,000 to make trades worth up to $100,000. The leverage is the factor by which the deposit is multiplied to reach the maximum trade value: in this case, 100, so the leverage is 100 to 1. The margin is simply the amount of deposit required as a percentage of the maximum trade value. Here, it is 1%. It is just the flip side of the earlier calculation.

Leverage = maximum trade value / deposit

Colloquially, “margin” is often used to refer to the cash deposited with a broker.

Initial deposit

The initial deposit is the first deposit a trader makes with a broker. This deposit may be subject to special rewards, such as bonuses.

Bonuses & promotions

Bonuses and promotions are marketing tools used by the broker to "sweeten" its offer, and thus to attract more business. You might want to consider whether a really top-quality broker would feel the need to offer such incentives.

Customer service

Customer service is very important for new traders and experienced investors alike. Whenever one runs into any sort of trouble with his or her broker, it is the duty of the customer service agent to iron everything out. As such, the expertise, skills and availability of the customer service staff should be a factor within the broker selection balance.

Availability

Funds deposited into trader accounts through third party checks typically take some time to clear. Once they do, they become "available". Availability hinges on the bank from where the check originates, and the availability schedule of the broker.

Trading platforms

The trading platform is the gate between the retail trader and the markets. It is also the tool through which the trader performs his trading. A proper, simple, fast and user-friendly trading platform is critical in trading successfully.

Ease of deposit & withdrawal

Being able to make deposits and to withdraw money from your broker quickly and easily is highly important. This all depends on the type of withdrawal and deposit options your broker supports. The selection of these payment solutions needs to be as large and as diverse as possible. It is also a good idea to check the withdrawal time, as many traders complain that it can take up to a week to withdraw, when they wanted their funds available quicker.

Minimum balances

The term "minimum balance" refers to the amount of money the trader needs to keep in his/her account to keep the account open and to receive the services he/she has signed up for. Obviously, the smaller this amount is, the better it is for the trader.

Instruments

In the context of forex trading, an instrument is defined as a tradable asset, and any asset underlying a derivative. Commodities, stocks, indices and currency pairs are all trading instruments, because through them, value is held and/or transferred.

How to become a forex broker

A forex broker can provide traders with a platform that allows them access the buying and selling of foreign currencies. The fact that forex trading is the largest market in the world means that this is a viable business that one can consider for their investment portfolio.

When running a forex brokerage firm, you can make a good salary and this is one of the best ways that forex trading companies make money. If you would like to become a foreign exchange currency trader, you may choose to visit engineforex.Com to learn more.

So, what are some of the things that one needs to do to become a successful forex broker? We shall discuss that in this article.

Here are tips to help you become a forex broker:

Understand the forex market

It is important that you understand how the forex market works before you can become a successful broker. Who are the players in the forex market? What are some of the factors that play a role in currency trading?

What is the jargon in the forex trading market? You need to know some of these things and ensure that you know other things such as the technical analysis required for forex traders, the macro-economic involved as well as the trading statistics and how to study the currency graphs.

It is only after you are conversant with these terms and jargon that you can indulge and succeed in this trade.

Get a feel of a modern forex trader or broker

This is another very important aspect of becoming a good trader or broker. You can only learn from experts and in this regard, you need to find a retired or a practicing forex broker so that you can learn the requirements of the job.

You need to know that the modern forex trading environment is highly advanced and automated as compared to some ten years ago. The brokers are almost entirely relegated to software management to ensure that the traders have a working platform. You can even learn these things online.

Get professionally certified

Forex brokers need to be professionally certified for them to be allowed to practice. In this regard, it is vital that you get certified by the relevant authorities. You may need to sit for certain certification tests such as the national association of security dealer’s tests.

The series 3 test is important for this certification. You can read for this test online and order materials for the same. The good thing with forex brokerage is that there are no specific academic requirements that one needs for certification or licensing.

Diversify the assets you trade

One of the ways brokers make money is through market volatility. A market that is moving sideways due to stagnation is not an ideal one for you to make money.

As such, diversification will help you make better returns. You need to find markets that are moving for you to make money. For this reason, you can trade in commodities, debt, equity indices, and equities among others.

How to get
a FOREX license

An overview of some of the most popular forex business licenses available to brokerages in 2019, the costs involved, and a more budget-conscious solution.

How to get a FOREX license

Which FOREX broker licenses
can I choose from?

Popular jurisdictions

Offshore FOREX license

An easier option

B2broker can provide you with all the tools you need to get started:

General overview of the money management platform

Major differences between account types

Growth hacking tricks with copy trading and PAMM offers

Fees sharing - a new instrument for IB sales

Content marketing ideas for better retention and conversion

IB referral flexible module: lots, markups, % commission fee

Investment platform (PAMM/MAM/social trading/copy trading)

Trader’s room (CRM) for your clients and a back office for your team

Several connectivity methods: prime XM, one zero, AMTS and FIX API

Single marginal account with liquidity for 800+ pairs

Liquidity for 7 asset classes

White label of MT4 or MT5

24/7 responsive support in 7 languages

Cost-effective pricing (no revenue share model - just a software fee)

If you would like to have your own licensed forex business up and running in just 3 weeks, speak with the professionals. Click here to get started!

How to start trading forex (4 steps)

Welcome to the world of forex. There might be many reasons why you are reading this article. It could be that your friend or acquaintance mentioned about how they trade and perhaps even make a living by trading forex. Whatever your reasons may be; this article will give you an overview of the forex markets and how to start trading forex … and perhaps make money for yourself.

Step 1. What is forex?

Step 2. Learn forex basics

Step 3: find a forex broker

Step 4: start trading

Step 1. What is forex?

Forex, or foreign exchange is an unregulated market, also known as OTC (over-the-counter) and is the biggest market with average daily turn-over that runs into billions. It is even bigger than the US stock markets. Although due to its OTC nature, no one can really give the correct numbers as to the forex turnover. But nonetheless, forex is indeed a big market and thus allows many market participants. From your neighborhood bank to specialized investment companies, to your friend; the forex markets always offers a piece of the action whoever you are and wherever you are (even from your home).

The basic concept of trading forex is very simple. You trade or speculate against other traders on the direction of a currency.

So, if you believe that the euro is going to rise, you would BUY the euro, or SELL the euro if you think the euro would fall. It’s as simple as that.

Step 2. Learn forex basics

Before you get ready to deposit your funds and start trading there are some important points you must understand, each of which are outlined below.

Forex brokers: in order to start trading forex, you will need to trade with the help of a forex broker. There are many forex brokers out there today who allow you to open a forex trading account for as little as $5. The forex broker is the one who facilitates your buy and sell orders and also allows you to research into the markets (also known as technical or fundamental analysis) to help you make more informed decisions… and of course allows you deposit more funds or withdraw your profits when you want to. ( click here to see our forex brokers rating )

Trading platform:you need a trading platform from which you can place your trades, which are then sent to the broker for settlement. Also, a trading platform is essential for you to conduct your technical analysis and also to see the current market prices. Most retail brokers offer the MT4 (short for metatrader 4) trading platform, which is free of cost. You can also open a demo trading account and practice trading with virtual money to gain the experience required before trading with real money.

Forex trading hours:while you might have heard that the forex markets never sleeps, it actually does. Firstly, you won’t be able to trade on weekends (saturday and sundays). But for the rest of the week, the forex market operates 24 hours a day. This is due to the fact that forex trading is global. At any point in time, you will always find an overlap of a new market session while the previous market closes. What time of the day or which market session you trade plays a big role if you are an intra-day trader or a scalper. This is another vast topic, which we will cover at a later stage. ( click here to learn more about forex trading hours . )

Now that you have a basic overview of the forex markets, here are some final pointers to remember before you start trading for yourself.

What is a pip?:pip is a measure of change in a currency pair’s value and is the 5 th decimal. For example, if EURUSD changes from 1.31428 to 1.31429, the change is denoted as 1pip (1.31428 – 1.31429 = 0.00001). When you trade, the more pips you make, the more profit you have. Ex: buying EURUSD at 1.31428 and selling (or closing your trade) at 1.31528 would give you 100pips in profit. ( read more about forex PIP )

Reading quotes: forex quotes are presented in a bid and ask price (both of which vary by a few pips and from one broker to another). The bid price is the price at which you can buy and the ask price is the price as which you can sell. So, a EURUSD quote would look like this 1.31428(bid)/1.31420(ask).

What is a spread?: spread is nothing but the difference between the bid and ask price. So in the above example, for 1.31428/1.31420, the spread would be 8 pips. ( read more about forex spread)

What is a leverage?: leverage is the amount by which you can request your broker to magnify (or increase) your trade value. Leverage is often quoted in ratios such as 1:50, which means that when trading on a 1:50 leverage, your $100 is magnified to $50000. Leverage is a big topic in itself and it is recommended to read this article to learn more. Leverage is important both in terms of making profits as well as managing risks and therefore, your trades.

What is a lot?: A lot is a unit by which you place your trade. In financial terms, a lot is also referred to as a contract. There are preset lots (or contract sizes) that you can trade. For example a standard lot is nothing but 100,000 units (known as 1 lot). ( read more about lot)

Reading charts: the ability to understand and read the charts is very essential to trading. Depending on your approach, you can choose between a line, bar or candlestick charts and trade accordingly (for example trading based on candlestick patterns). ( read more how to read forex charts)

Placing orders (how to buy and sell): in forex trading, it is possible to either buy or sell any currency pair. Most trading platforms, give you this option. You buy when you think that price will go up and you sell when you think that price will fall. There is a common terminology used in forex trading, which is buy low, sell high; which is an important point to remember. ( read more how to place orders with MT4 )

Order types: besides buy and sell, another point to remember the types of orders. There are two basic order types: market orders and pending orders. When you click on ‘buy’ or ‘sell’ you are basically buying (or selling) at the current market price. A limit order on the other hand tells the broker that you want to buy or sell only at a particular price. ( read more about types of forex orders)

Step 3. Find a forex broker

As mentioned, there are many forex brokers today and therefore it can get confusing on how to choose the forex broker that is right for you. To briefly summarize, remember the following points while choosing a forex broker:

Look for a forex broker that is regulated

See if the forex broker offers a minimum deposit amount

What is the leverage that the broker offers

What is the minimum contract size that you can trade

Bonuses and the terms and conditions (see on our site list of forex deposit bonuses and forex no deposit bonuses)

Deposit and withdrawal types as well as the terms and conditions

Trading methods that are allowed by the broker

We can also help you choose a forex broker by reading our article how to choose forex broker

Step 4. Start trading

Finally, now that you have selected a forex broker to trade with it is recommended to first open a demo trading or a practice account. Most forex brokers offer unlimited demo trading account (but will be deactivated if not used for 30 days). This is a good way to get acquainted with the forex markets and also help you to understand your trading style (scalper or intra day trading, swing trading, etc) and approach (fundamental or technical analysis). You can search for various trading methods and systems or you can develop one yourself when you have a good understanding of technical or fundamental indicators.

Conclusion:

Forex trading is one of the most active and dynamic ways to trade the financial markets. At the heart of everything, it is the basic fluctuations in currency values which drives everything else. Learning to trade forex and understanding the forex markets can give a good foundation to trading other markets such as derivatives or equities.

How to become a forex broker

Learn how to become a forex broker and make a living from it

The forex market is becoming more and more powerful. This is why you should learn how to become a forex broker and earn good money from it. More than $1.8 trillion is traded on the stock market each day, so the potential is huge here. That’s why we created a list with some of the best methods you can use to become a forex broker.

Understand how to become a forex broker by doing your research

Yes, research is crucial if you want to become a forex broker. You should read as much as you can about the topic. You will understand what a forex broker does, which are his responsibilities and so on. Books and even web articles will help you figure out the mechanics, players, and workings of the stock market. This will also help you understand the forex jargon too.

Connect with active or retired brokers

This way you will get to understand some of the methods they use. Mentorship is important for a beginning, so trying to find the right mentor can be very helpful here. Try to consider that and use this approach to your advantage.

Use forex tools

There’s plenty of forex software out there. The best thing is that most of them offer you a practice mode with virtual money. This way you can practice before you start trading with real money. It just makes a lot of sense to test out these waters before you obtain any good results from that.

Get a forex certification

If you want to learn how to become a forex broker, you have to study a lot. But you also need a professional certification. You need to pass the national association of securities dealers series 3 test.

Preparing for this exam is mandatory, and you will have no problem getting good results from it this way. A college degree in economics or business will help you.

Register as a forex broker/start your new forex company

There are 2 things you can do now once you are certified. You can either work a higher entity as a broker, or you can start your own business. Working for others is the best thing to do for a newcomer to the industry, as you accumulate more experience.

If you want to start your own forex trading business, you will have to think about the overall costs. These include company registration, opening a corporate bank account and a physical office, creating a site, choosing the trading platform and hiring staff. All these things will cost money, so you do need a major initial investment.

Figuring out how to become a forex broker is not as hard as you may imagine. But it does take time, so you have to be patient. Pursue your dreams and remember to always practice.

Once you are a certified forex broker, it will be easy to find a job or even create your own business in the industry. There are tons of great opportunities to pursue here, and you are free to pick the right one which suits your needs!

How forex brokers make money

In the foreign exchange market, traders and speculators buy and sell various currencies based on whether they think the currency will appreciate or lose value. The foreign exchange, or forex market is high risk and sees more than $5 trillion traded daily. Traders have to go through an intermediary such as a forex broker to execute trades. No matter the gains or losses sustained by individual traders, forex brokers make money on commissions and fees, some of them hidden. Understanding how forex brokers make money can help you in choosing the right broker.

Role of the foreign exchange broker

A foreign-exchange broker takes orders to buy or sell currencies and executes them. Forex brokers typically operate on the over-the-counter, or OTC, market. This is a market that is not subject to the same regulations as other financial exchanges, and the forex broker may not be subject to many of the rules that govern securities transactions. There is also no centralized clearing mechanism in this market, which means you will have to be careful that your counterparty does not default. Make sure that you investigate the counterparty and his capitalization before you proceed. Be vigilant in choosing a reliable forex broker.

Forex broker fees

In return for executing buy or sell orders, the forex broker will charge a commission per trade or a spread. That is how forex brokers make their money. A spread is a difference between the bid price and the ask price for the trade. The bid price is the price you will receive for selling a currency, while the ask price is the price you will have to pay for buying a currency. The difference between the bid and ask price is the broker’s spread. A broker could also charge both a commission and a spread on a trade. Some brokers may claim to offer commission-free trades. These brokers probably make a commission by widening the spread on trades.

The spread could also be either fixed or variable. In the case of a variable spread, the spread will vary depending on how the market moves. A major market event, such as a change in interest rates, could cause the spread to change. This could either be favorable or unfavorable to you. If the market gets volatile, you could end up paying much more than you expected. Another aspect to note is that a forex broker could have a different spread for buying a currency and for selling the same currency. Thus you have to pay close attention to pricing.

In general, the brokers who are well-capitalized and work with a number of large foreign exchange dealers to get competitive quotes typically offer competitive pricing.

Risks of foreign exchange trading

It is possible to trade on margin by depositing a small amount as a margin requirement. This introduces a lot of risk in the foreign exchange market for both the trader and the broker. For example, in january 2015, the swiss national bank stopped supporting the euro peg, causing the swiss franc to appreciate considerably versus the euro. traders caught on the wrong side of this trade lost their money and were not able to make good on the margin requirements, resulting in some brokers suffering catastrophic losses and even going into bankruptcy. Inexperienced traders could also get caught up in a fat finger error, such as the one that was blamed for the 6% dip of the british pound in 2016.

The bottom line

Those contemplating trading in the forex market will have to proceed cautiously—many foreign-exchange traders have lost money as a result of fraudulent get-rich schemes that promise great returns in this thinly regulated market. The forex market is not one in which prices are transparent, and each broker has his own quoting method. It is up to those who are transacting in this market to investigate their broker pricing to ensure that they are getting a good deal.

So, let's see, what we have: how to become a forex broker if you have decided to invest time and money to become a forex broker, the following information will help you get started. Your new brokerage company set-up plan at how to get a forex broker