Forex Brokers and Spreads

Forex trades are constantly growing in popularity. New Forex broker companies are opening up at a very high rate. Many people who are accustomed to working in 9-5 jobs are leaving their jobs and starting to trade with hard currency. There are many explanations for the growth of the forex currency market, some of the most obvious is its size, its simplicity, and its potential benefits.

When one thinks about foreign exchange transactions compared to other world markets, such as the stock market, some very basic differences should come to mind. These include greater liquidity, more volatility, greater multiplier effect, as well as lower trading fees and lower costs. We have already talked about the liquidity, volatility and leverage offered in the forex, so now we are going to learn a little more about trading costs and commissions, compared to other global markets.

Take the stock market, for example. When one trades with stocks, which by the way is a very common phenomenon for currency traders to test stocks before currencies (a lot of people fail to trade stocks and then go back to the forex market, and with reason), the way the transactions are carried out is for the investor to make purchases and sales by paying commissions on both sides of the transaction. What does that mean? When you trade in shares, you usually do it in collaboration with a broker, who charges you a fixed amount per transaction, a dollar amount per share, or a scale commission based on the size of your transaction. This commission applies when you buy a stock, as well as when you sell it.

Now let's talk about Forex trading. The vast majority of online Forex brokers advertise in very large letters on their website that do not charge any commission for trades. With the exception of a few brokers, the currency market allows traders to open and close positions with no commission whatsoever.

Therefore, it does not cost anything to trade in Forex. This, of course, raises the obvious question: How do Forex brokers make money?

This is where it gets complicated. It is true that many brokers do not charge direct commissions for trading in the Forex market, but brokers dedicated to currency trading do not perform trades that tell traders the goodness of their hearts. You can be sure that they are profiting from your services and these are usually quite high. They charge what are known as spreads.

Before understanding what the spreads are and how they are calculated, it is important to understand a fundamental principle on how the Forex trading system works. Everything is based on supply and demand, just like any other market. If there is a greater demand for dollars, the value of the dollar rises against other currencies. This is precisely how spreads are defined and calculated.

The spread is the difference between the price at which a broker is going to buy the currency for you and the price at which it is sold. So, for example, if you open a position where the base currency is the dollar, and since there is no shortage of dollar demand, the spread of this operation will almost always be smaller than a spread for a less common currency . Why? This is again, by supply and demand. The agent will have no problem at all in selling the dollars you just bought, so you do not need to charge the operator, bone you, a higher spread. Now that, if the base currency of the position is the Vietnamese Dong, it is understood that it is very likely that the spread will be higher.

Another feature that Forex brokers take into account when calculating spreads is the type of account in which you are trading. Mini accounts are typically associated with higher spreads. This is, of course, because the agent has to compensate for the relatively low amount of capital being traded at a higher spread, so that he can make a profit.

Now that we have established how attractive Forex trading is, it is not totally free. Next we will establish the difference between the forex spreads and the commissions of the stock market. The main difference is that in the Forex, it is usually only charged the spread of a single side of the transaction, the buying side or the selling side. When you buy or sell the currency, it is when the brokers in general, get their benefits by charging the spread.

It is extremely important that Forex traders understand the importance of the spread when it comes to choosing a forex broker. The difference that a pip can make on the spread of a broker can be the difference between a successful Forex trader and one that fails completely in the currency trading market.

To summarize, let's look at a concrete example of a spread to understand exactly how it works. Let's say we have a USD / CAD purchase price of 120.00 (which is the price at which the agent is willing to buy the USD) and a sale price of 120.05 (the price at which the agent is willing to sell the USD ). In this case, the spread is equal to 0.05, or 0.0005 dollars, and the money goes directly into the pockets of the broker.

There is a lot more to say about spreads in the Forex market, such as if a broker offers fixed or variable spreads, but at least now you have a better understanding about what they are.

CHARACTERISTICS OF AN EXCELLENT BROKER

When choosing a Forex broker it is very common to research all the features that are available as they should directly affect your buying decision. While this makes sense as a consumer, some of the features may not be necessary, and frankly even be overbearing.

One of the biggest overrated features that is commonly found is something called Auto chartist. This piece of software, randomly, chooses the technical patterns in the table, putting them to your attention. In theory, it's a great idea. But the reality is that by using this software, you are doing nothing to advance your knowledge as a marketer. There is no reason to trade in the forex market if you are not willing to learn it.

Another big problem with this software is that often technical guidelines are given that are suspicious by nature. For example, a pennant pattern on the five-minute chart is nothing to worry about. While the pennant pattern is displayed on the weekly chart as well, the truth is that it shows too many poor quality patterns since the software seems to lack filters to keep away some of the technical adjustments that are not so relevant.

Other factors to consider

Forums are a complete waste of time when it comes to your Forex broker. Most of the forum discussions that can be seen in these topics tend to be non-real. In other words, it's just a lot of people lighting each other on the Internet. At best, you will have plenty of ignorant people trying to convince you that your trading setup is correct, even though you have no idea what they are doing. In the worst case, it becomes a primary school including insults and nicknames.

The analysis may be exaggerated at times. It all boils down to the particular analyst that the company hires. Most of the known analysts are working for the larger brokerage firms. Quite often this is highly respected analyst, but the smaller broker may hire someone who does not necessarily know what they are doing. One of the biggest signs for a suspicious analyst is if they focus primarily on short periods of time. If the analyst tends to display a large number of graphs of five, 15, and one hour, it is very likely that your goal is to generate more trading and thus split your money faster.

One of the most common time wasters you will encounter with Forex brokers is the Dow Jones news source on their MetaTrader4 platform. Although the content of the news is certainly acceptable and professional, at the moment of receiving the news of the platform, the markets are already affected and therefore become useless. It is almost impossible to compete with brokers who use Bloomberg terminals and T-1 connections for their news services.

While not all of these services are dangerous, they may necessarily be a reason to open an account with a specific Forex broker. You will find that most forex brokers are essentially the same, and offer very identical packages. To be honest, the industry is simply not as innovative. By focusing on what is truly important to you in particular, you will find that you will not be absorbed by a Forex broker based on "empty calories."

Is a Good Idea to Change Forex Broker?

One important reason you may have to switch Forex broker is certainly fear for the security of your deposits. If you ever ask your broker to withdraw some funds from your account, and it becomes excessively slow or unresponsive, then this is an excellent reason to switch brokers immediately. Of course, if you hear some reliable information about your broker's financial situation or ethics, it will also be good to consider a change. It is advisable to check from time to time the professionalism of your broker, even if you have obtained some good results, requesting the withdrawal of some of your recent earnings. If there is an unwarranted delay, it is advisable to close the account immediately and, if necessary, threaten to contact the corresponding regulator.

Moving from critical reasons to more common reasons, one of the factors that urged more than one customer to change brokers is the average level of spreads that are charged. For example, there are still brokers charging a spread of 3 pips in the EUR / USD pair. While this was the norm a few years ago, today it is considered extremely expensive. Switching to a broker that offers the EUR / USD at 1.5 pips or less makes sense, since the spread becomes the "cost of doing business", and over time can generate a loss in operator income, especially if you trade frequently using short time frames.

Another good reason to switch brokers can be an unstable platform. If you find that the trading platform is disconnected very frequently or that it takes a long time to execute an operation, then this is a convincing proof of incompetence or dishonesty. Dishonesty is more likely if these disconnections or freezes happen every time you are trying to enter a trade where you would have made profits quickly. Of course, it is important not to be paranoid and not to blame your broker for all your losses. However, as the Forex market does not have a centralized place, brokers have a commercial incentive to "shadow" their spread just above levels where many of their customers have stop-losses set in open trades. determining whether your broker is acting shady is to see if these price movements do not match the price feedback of other brokers.

Watch two or three. If your broker tends to produce sudden and unexplained spikes in price, which are not followed by other brokers, it is time to think about moving away from it.
A good way to get a better understanding of whether a particular agent is the best for you is to think about what the brokers are actually doing, and see things from their point of view. In order to do this, it is helpful to start with some facts about Forex trading:

1. Most currency brokers are not really trading any currency in the market. They are simply providing a price indicator, in the movements of which their customers can bet in exchange for two effective quotas: the spread or commission, and a small charge during the night that incurs each night any position that is left open. These brokers are in antagonistic relationships with their customers: they make money when their customers lose and lose money when their customers win.

2. The remaining currency brokers tend to monitor the trades of customers who have profitable trading data, and cover the aggregate positions of these traders with a bank. These brokers have a less contradictory relationship with their customers, but they may still face problems in the proper way of covering themselves in rapidly evolving markets.

3. The real Forex market is dominated by four large banks which together account for about 85% of the market volume. These banks provide liquidity to the smaller banks, which in turn do the same with smaller banks, who then provide liquidity to the brokers, and so on in the chain in size and importance. This tends to mean that the smaller the broker, the worse the price and the spread that is willing to give, since they themselves will not be able to get premium prices. The dilemma here is that these smaller brokers tend to offer lower minimum deposits. The more money you have to deposit, the better the service that will be available to you. Of course, this does not mean that you have to go higher up the chain than the one that is appropriate for your account size. In general terms, it is a good idea to adapt the Forex broker to the size of your account.

4. Much of the Forex market has a bad reputation and is poorly regulated. When these facts are combined with the natural tendency of the human being to be tarnished by greed, it creates a profitable vacuum for unscrupulous brokerage houses that have no reputation to protect. This is not to say that small Forex brokers are fraudulent, but do not assume that your deposit is secure just because you opened an account with a broker. However, if that broker has a public reputation and is subject to regulations, you will surely be able to sleep peacefully.

There are other good specific reasons that may play a role in determining the choice a broker are as the availability of a specific pair that you want for trade, platform, quality of customer service and other "concrete" things. Now that we have covered all of the critical aspects to consider when choosing a broker, it is time to shift your focus on how you can conquer the forex markets - with hard work and patience, of course!

Five Ways to Detect a Forex Broker Scammer

If you are looking for a new Forex broker, or wondering if your broker is giving you an acceptable deal, then here is a list of some things for you to consider when doing your evaluation.

1. Not All Forex Brokers Are Thieves!

It would be very unfair to take the attitude that Forex brokers are all delinquent. What you should keep in mind, is that most Forex brokers do not place their clients' trades in the real market, and charge us spreads instead of commissions. This means that most Forex brokers are in direct conflict of interest with their customers: the more their customers lose, the more money the brokers earn. In fact, your business model is based on the failure of your customers' trades.

It is a sad fact that most Forex traders lose, but this is mainly due to poor trading methods, and does not mean that Forex brokers have to act dishonestly to make gains

However, more profits are always good news, so there are some tricks that some brokers have in their sleeves to squeeze more money out of flexible customers, and here are some things you should keep in mind.

2. Spreads or High Commissions

Spreads have fallen a lot in recent years. Of course, the more money you have to fund your account, you'll probably find better spreads available to you. This is because brokers offering better spreads often require higher minimum deposits. In any case, you really should compare your options. The days of having to pay a spread of 3 pips per EUR / USD are over.

Recently, more brokers have been introducing commission-based models, where customers pay a fixed amount of cash per trade. When you encounter this, carefully calculate how much you usually risk in a trade per pip, and then calculate that "spread" you will be paying. Sometimes these more commission spread offerings are designed to make the offer look better than it really is, and you can only discover this once you do custom calculations.

3. Financing During the Night

Unless you are a pure day trader and close all positions before 10 pm or London midnight every day, you will pay or receive a small amount (usually less than 1 pip) for each open trade you have at that moment. This is based on the interest rate differentials between the currencies that make up that particular pair, but it is structured by practically every broker as a net loss for the customer. Some brokers are much worse than others, and many do not advertise these rates - you only see it in your statement the next day once the payment or deduction has been made. If you get in touch with most brokers, they will usually be prepared to quote your overnight financing rates. Get some quotes and compare them on the same currency pairs, and maybe be surprised by the results. If you enjoy holding long-term trades, make a few calculations about how much you are likely to pay on this overnight financing. You may find that it significantly decreases or even erases your earnings.

4. Execution of Sudden Stops / Increases

It is not widely understood that brokers control their own prices. There is no central market, and most brokers are not making real trades, and they can quote whatever price they want! Of course, they have to keep the prices fairly honest, otherwise they could use the prices of other brokers to correctly predict price movements, and as a result they would lose money. So you really do not have to worry that your broker will invent the price.

What might worry you is that a broker can see where your customers are grouping their stop loss orders, and if the overall market price comes very close to triggering these stops, the broker might be tempted to quickly push their price on that level and take profits. This can be done even more easily during news announcements or sudden shocks that have the effect of raising the overall price of the market up or down. An unscrupulous broker can always send the price a little higher or lower at those times.

To be fair, mistakes are sometimes made, and brokers often compensate for trades interrupted after excessive peaks when enough of their customers complain. However, it is something for you to be careful about.

5. Interruptions

There are times when the market is fleeing in a clear direction. If you want to trade and can not get a connection with your broker, or the trade is repeatedly rejected for some unknown technical reason, then be careful. This is a type of a broker who is using unfair methods to prevent their customers from placing winning trades. If it happens a lot, it's a suspicious signal.

This is not an exhaustive list of things to consider when choosing a Forex broker, but they are the most common broker problems that can make winning in Forex much more difficult than it should be if you do not consider them.

The Forex Brokers Game

Choosing a Forex Broker

It sounds like a strange way of choosing someone who is going to handle a substantial amount of our money but it often seems like this is the way the novice Forex trader makes his choice. Even before you start trading you have to make an important decision, and that's who your Forex broker is going to be. You might think that a decision like this would make a person investigate, ask questions and be careful. However, so many people fall into the trap of Forex scams and questionable Forex brokers that has given the whole industry a bad name, and it should not be so. The Forex market is a wonderful and legitimate way to make a living; but like any industry, it has its thieves and scammers. The first rule is the obvious one: "If it seems too good to be true ... it probably is."


The first thing you want to do is make sure the broker suits your needs. Make sure you offer a demo account; find out your minimum balance and minimum trade; whether or not they have live support or everything is done via email. That kind of things. Very basic things, and most Forex brokers will take care of that. Even the most suspicious.

Regulated Forex Brokers

But here is something you will not have thought of. Make sure your broker is set. Find out which regulatory agencies are registered. They must register with the Commodities Futures Trading Commission (CFTC) as Futures Commodity Trader (FCM). The CFTC and the NFA (National Futures Administration) were created to protect small (and large) traders in fraud, scams and other unpleasant practices from wrongdoers. Use your services and information. They have websites and phone numbers if you have any questions. The Forex broker you choose will have your money in your hands. You should feel completely comfortable with that before you give a penny.

Do not get caught up in flashy websites and bold promises. This is not a casino you are about to enter. This is a business, and like any business, due diligence should be done. Take your time and get answers to all your questions. Then, after you have had all the answers to your questions, find out from other Forex traders what questions you might have missed. There is no such thing as being too careful when choosing the right Forex broker for you.

Tips for Choosing a Good Forex Broker

In the 70's the Forex market was created, and in the last 10 years it has experienced strong growth thanks to the internet and new technologies. There are studies that indicate that there are daily transactions in the Forex market worth 4 trillion dollars (the New York Stock Exchange moves 50 times less daily).

In addition, individual investors and traders have grown very fast, thus becoming one more participant, although very small in comparison with the Central Banks, commercial and investment. With this great growth in the Forex market have emerged new investment brokers with the aim of attracting retail investors. There is so much broker offer that it is difficult to choose a good broker.

A broker is the financial intermediary in our operations, that is, it is the intermediary between buyers and sellers. 10 tips that you would have to consider to choose a good broker in the Forex market are:

1. Avoid welcome gifts

Avoid all those brokers who offer welcome gifts type 30% welcome bonus. In most cases if you stop to read the fine print of the conditions, you realize that in order to withdraw the bonds or the money itself, you are more likely to end up losing all the money deposited. One fact to keep in mind is that if you want to withdraw your money and do not meet the conditions (almost always), you will be deducted from your account the bonus received or the amount of the gift made.

      2. A solid and respectable broker

Choose a broker with a lot of equity, because the greater the capital of the firm, the greater the protection of its funds. To determine the vitality of a broker, you should look at the number of employees you own. If you are a solid and respectable organization, you will have hundreds of employees, who will be able to assist you 24 hours a day. It is also likely to have hundreds of thousands of accounts. If the firm has few employees it is likely that they have a small capital or they are unable to provide the personal assistance you need.

       3. Regulated Broker

It should be noted that the broker is regulated by a competent entity such as NFA (United States), FSA (United Kingdom), FINMA (Switzerland), among others. We must avoid all those brokers who are in tax havens. Brokers in Europe, Canada, Hong Kong and Australia have adequate regulations, and capital requirements are high. If your company is in a third world country, the current regulations may not be adequate.

        4. Greater Leverage

Leverage can help you reap considerable profits but can also cause huge losses. It is advisable for a broker to provide the leverage so that it can operate effectively in the forex market. Of course, greater leverage means better opportunities for you. Some brokers offer a leverage of 100: 1, which means that for every dollar in your account, you can borrow and use up to € 100. Other brokers offer up to 250: 1. When choosing a broker, you have to take into account the leverage offered, as this could be your ally to win big.

        5. Account Types

It is advisable for the broker to offer different types of forex accounts. For example:

•   "Mini" accounts require a minimum margin or equity that could be $ 250 onwards. With this type of account, you can trade in forex but the level of leverage is lower.
• "Standard" accounts, which require a minimum of $ 2000. This type of Forex account allows you to open larger positions.
•   The "Premium" account allows the opening of even greater positions.

       6.  Real-time information and good graphical tools

Facilitate daily decision making, helping to choose a more optimal investment.

       7.  Have a free demo account

It is advisable that the Broker has a free demo that operates in real time because it allows you to practice and learn from real or fictitious money the features and services of the broker you want to contract before opening a real account.

      8.  Avoid so-called brokers Snipers or Hunters

These brokers often buy or sell based on preset points, usually perform these maneuvers to increase their profits. Avoid this type of corridors. To know who these brokers are, you must communicate and interact with other operators online or through forums.

      9.  Automatic execution


One of the most important variables to keep in mind when choosing a broker is the speed of executions. The best thing is that the execution is automatic, so when we want to enter or leave the market at a certain price, the Broker usually respects it.

      10. Do not pay spot fees


Forex traders do not pay commissions for placing orders, unlike those that operate in futures markets. Actually, a Forex broker is a simple broker, not a broker or broker itself. Therefore, they obtain benefits through the Spread, this is the difference between the value of the "bid" and the "ask".

      11.  Remember the differences between hiring a market maker and an ECN (Electronic Communication Network)

You have to take into account the differences between an ECN and a market maker to know which type of broker can best meet your investment needs.

It should be remembered that: price volatility in an ECN is often higher than in a market maker's network, ECNs often do not allow leverage, unlike market makers. In addition ECNs usually give the prices that their liquidity providers mark, with the same exact margins, and then charge a commission for each round round transaction. However, market makers can open an account with fewer resources and their platforms are easier to use.

Do not forget that the market maker or market maker covers the position with other operations or does not cover it, so it assumes the risk contrary to yours. That is, if you win the market maker loses, which creates a conflict of interest.

        12.  Good customer service

The customer service is very important because they will help you to resolve any possible incidents that you may have. It is advisable to look for a broker to solve them as quickly as possible, not to hinder the withdrawal of funds, which does not have many complaints from other investors. To know the opinion that other investors have about the brokers in the market you can consult and participate in forums.

How to Choose a Forex Stock Broker

To choose a good broker in forex we must carefully analyze the great offer that exists in the network. While some offer professional and serious services, many others take advantage of the boom in this market between small and medium investors, offering attractive promotions but the services offered are not appropriate. To choose a trustworthy broker, we must first ensure that it is perfectly regulated, so our savings will be safe and we can invest in peace of mind.

A broker must be regulated by the agency of the Stock Market of his country. Each country has a serious regulatory agent. Not all brokers have these quality accreditations, are difficult to obtain and are proof that their work is reliable and will be continuously monitored by an independent instance.

This means that if we have any problems, we can file a formal complaint with the regulating agency and it will open an investigation and even withdraw the broker license.

In addition to being regulated, so you can perform operations with good profitability and profits, you must know the commissions of the broker. The most common ones are: the commission of custody and deposit of securities (this varies between a broker and another), brokerage commission (which may be negotiable with the entity), brokerage commission (which is issued when an operation is performed through a non-stock company), the liquidation fee and the stock market, the latter being independent and established based on the effective value of the transaction.

Forex Market: What is Forex?

Forex is the acronym for "Foreign Exchange" (FX) and refers neither more nor less than to the global currency trading in all markets. It is the largest financial market in the world and, because it is not centralized (that is, there is no central stock market such as, for example, stocks), it allows trading currencies through a global network of banks, brokers , financial institutions, companies and investors during the 24 hours of the day.

The Forex market, Forex or simply FX was born in the decade of the 70s in order to improve monetary flows derived from international trade, namely: facilitate the sale of national and international currencies at real prices. Currently, the volume of transactions exceeds USD 1.5 trillion, becoming the most liquid market with the largest number of operators.

Due to the ease of speculating with any currency and the high profitability that is offered, many governments have established control policies on foreign exchange transactions to avoid devaluation or excessive revaluation of one currency compared to others. Logically these phenomena affect directly to the internal and external economy of any country.

Although there are more than 182 currencies, the most traded currencies are the dollar, the euro, the pound sterling, the yen and the Swiss franc.

Is a Good Idea to Change Forex Broker?

One important reason you may have to switch Forex broker is certainly fear for the security of your deposits. If you ever ask your broker to withdraw some funds from your account, and it becomes excessively slow or unresponsive, then this is an excellent reason to switch brokers immediately. Of course, if you hear some reliable information about your broker's financial situation or ethics, it will also be good to consider a change. It is advisable to check from time to time the professionalism of your broker, even if you have obtained some good results, requesting the withdrawal of some of your recent earnings. If there is an unwarranted delay, it is advisable to close the account immediately and, if necessary, threaten to contact the corresponding regulator.

Moving from critical reasons to more common reasons, one of the factors that urged more than one customer to change brokers is the average level of spreads that are charged. For example, there are still brokers charging a spread of 3 pips in the EUR / USD pair. While this was the norm a few years ago, today it is considered extremely expensive. Switching to a broker that offers the EUR / USD at 1.5 pips or less makes sense, since the spread becomes the "cost of doing business", and over time can generate a loss in operator income, especially if you trade frequently using short time frames.

Another good reason to switch brokers can be an unstable platform. If you find that the trading platform is disconnected very frequently or that it takes a lot of time to execute an operation, then this is a convincing proof of incompetence or dishonesty. Dishonesty is more likely if these disconnections or freezes happen every time you are trying to enter a trade where you would have made profits quickly. Of course, it is important not to be paranoid and not to blame your broker for all your losses. However, as the Forex market does not have a centralized place, brokers have a commercial incentive to "shadow" their spread just above levels where many of their customers have stop-losses set in open trades. determining whether your broker is acting shady is to see if these price movements do not match the price feedback of other brokers.

Watch two or three. If your broker tends to produce sudden and unexplained spikes in price, which are not followed by other brokers, it is time to think about moving away from it.

A good way to get a better understanding of whether a particular agent is the best for you is to think about what the brokers are actually doing, and see things from their point of view. In order to do this, it is helpful to start with some facts about Forex trading:

1. Most currency brokers are not really trading any currency in the market. They are simply providing a price indicator, in the movements of which their customers can bet in exchange for two effective quotas: the spread or commission, and a small charge during the night that incurs each night any position that is left open. These brokers are in antagonistic relationships with their customers: they make money when their customers lose and lose money when their customers win.

2. The remaining currency brokers tend to monitor the trades of customers who have profitable trading data, and cover the aggregate positions of these traders with a bank. These brokers have a less contradictory relationship with their customers, but they may still face problems in the proper way of covering themselves in rapidly evolving markets.

3. The real Forex market is dominated by four large banks which together account for about 85% of the market volume. These banks provide liquidity to the smaller banks, which in turn do the same with smaller banks, who then provide liquidity to the brokers, and so on in the chain in size and importance. This tends to mean that the smaller the broker, the worse the price and the spread they are willing to give, as they themselves will not be able to get premium prices. The dilemma here is that these smaller brokers tend to offer lower minimum deposits. The more money you have to deposit, the better the service that will be available to you. Of course, this does not mean that you have to go higher up the chain than the one that is appropriate for your account size. In general terms, it is a good idea to adapt the Forex broker to the size of your account.

4. Much of the Forex market has a bad reputation and is poorly regulated. When you are

How does the XTB broker work?

When opening a trading account with an online broker the main doubts of the users are not so much in the operative or the platform of operations but in the processes of deposit and especially of withdrawal of funds: Is the broker reliable? Can we withdraw our money without problems? Is it a simple or complicated process? How long does it take to receive the money?
To try to help you solve these issues, from InvertirEnBolsaWeb.net, we periodically perform various in-depth analyzes of the main online brokers and we show you step by step our real experience, with screenshots, on how to open an account, the data that you the documentation you must send, the ways to deposit funds and how to withdraw your money.
This time it is the XTB broker's turn:

HOW DOES BROKER ONLINE XTB WORK?

XTB (XTB Limited) is one of the leading online Forex brokers and CFDs (the 4th largest broker quoted). It is regulated by the UK's Financial Conduct Authority (FCA) and operates under the most stringent European regulations for investor protection. It provides two main trading platforms: xStation (in web format, a fast platform, powerful yet easy to manage) and MetaTrader 4 (the most popular platform worldwide, with its powerful system of graphs, technical analysis tools, possibility to use automatic trading systems, ...)
It is a versatile broker for all types of traders and allows you to trade more than 1,500 different financial instruments: Forex currencies, commodities, gold, silver, oil, ... and a good number of CFDs on stocks, stock indices. There is no minimum deposit to open a real account and the spreads are quite low (from 0.9 pips for Standard accounts and 0.28 pips with commission per lot operated for Pro accounts).


OUR REAL EXPERIENCE WITH XTB:

This real experience consists of 3 different articles: First we have requested the opening of an account in XTB and passed the verification process sending the necessary documentation, then we have seen the forms of income available and deposited funds. Finally we opened and closed a position and ended up requesting the withdrawal of our money. With these articles you can check graphically and in detail how these processes are carried out in the XTB broker and our recommendations in this regard.

What is and how does the stock market?

Are commissions that are charged for each transaction of purchase or sale on the shares traded on the continuous market.These rates are inescapable and exactly the same for all brokers. The applicable rates are of two types:

1. The royalty or canon fees proper

2. Settlement Fees

To keep in mind

The broker commissions we have hired must always be added to the broker commissions listed here. Said broker, as an intermediary, is responsible for launching orders to the market on our behalf, so he receives a commission each time he has to intercede for us and negotiate a purchase or a sale. Each entity has its own tariff sheet that differs in any case from its competitors. Most brokers usually do not include broker commissions among their prices, so we will have to add them apart.

The system of tranches of the Spanish stock exchange rates is thinking in a way that, to a greater investment, prices much more economic. Thus, if you are touching the threshold of a higher tranche in your operations, you may want to invest a little more and exceed the next threshold (since commissions will be lower).

When you are going to hire a broker, remember to also take a look at the special commissions: for collection of dividends, by mail, etc.

The best trading platforms

Almost as important as finding the best online broker is the choice of a trading platform that fits what we are looking for. Many traders do not notice this peculiarity and only take into account the commissions and which is the cheapest broker. However, sometimes cheap can be expensive and as we always warned, when investing our money are not worth half measures we have to report well! That's why we bring you a selection with some of the best trading platforms so that you start to operate with the most appropriate tools.

1. Broker and trading platform are not the same

We often have a capital problem that some brokers seem to ignore: we did not find information about the trading platform offered by the broker in question anywhere!

How is this possible? As it turns out that broker and trading platform are not the same: while the former is the intermediary arranged directly between us and the stock market; the trading platform is the working tool through which we will operate, negotiate and issue orders. What does this mean? The broker will offer us a service while the platform will allow us to execute our strategy.

Therefore, if we do not have the appropriate means to invest, our investments can end badly.Two types of brokers: with or without own platform

         2. Two types of brokers: with or without own platform

When it comes to hiring an online broker we are going to run into two possibilities:

•        Brokers who have developed their own trading platform.
•        Brokers that use a multibroker platform (also available to other providers).

Although there are very powerful tools developed in house by some brokers, keep in mind that a multibroker platform can open many doors to you when changing and negotiating with other suppliers.

Learning the operation of a platform is not an easy task, therefore, it is less advisable to hang on a platform that you can only use with a specific broker. As a rule, all brokers offer a platform (either proprietary or not) for free for their customers.

         3. Looking for the best trading platform

• Offer the stock instruments with which you want to invest.
• Have the functionalities you want to work with:
• A social trading platform is useless if you are not interested in following or sharing your trades. This will depend on your strategy and how confident you are with one or other of the functions: analysis indicators, real time, order types, graphs, automatic trading system, etc.
• Platform is friendly and simple to use:
• In an ideal paradigm, the best platform is the one that offers the most complete and easy usability for the user.
• Make it fast.
• That offers software compatible with our operating system:
• If we do not want to be using patches all the time, the better the software is compatible with our computer. Interesting are also the mobile version and online (called webtrader), so that we can operate anywhere in the world with any support without needing to download the program (tablets, mobile, other pcs).
• Access to the tool code:
• Some platforms like Metatrader 4 allow to modify the programming codes to create indicators or own scripts among others.

         4 and 5. The best multibroker trading platforms ( Metatrader )

We started the list with the trading platform par excellence Metatrader 4 (and currently its update 5). Created initially for Forex in 2005 by the company MetaQuotes, today it has been adapted for trading with more instruments.

•  Free trading platform.
• Analyze the market and execute orders (snapshots or pending).
• Customize the graphics and create your own scripts and indicators thanks to its open code, among others.
• You have an internal mail to contact your broker as well as a help system.
• You can have two real counts and as many demos as you want (with pretend money).
• More than 90 indicators.
• Automatic trading system.
• New webtrader format so you do not have to download the software.
• Ability to download the data history.

Ninjatrader

It is a platform whose operation is more focused on execution than on analysis. Ninjatrader is part of the NinjaTrader Group, LLC group, founded in 2003 and currently has more than 40,000 represented through more than 150 brokers around the world.

• Payment trading platform (demo with limited options).
• Operational especially for trading with futures, but also allows shares, forex and CFDs.
• Analyze the market and execute orders directly from the charts.
• Extensive customization of its graphical interface.
• Ability to download the data history.
• Real Time and Strategy Backtesting.

Visual Chart

Visual Chart is a multitasking platform specially designed for technical, graphic and fundamental analysis. Part of the Visual Chart Group, S.L. which was born in Almería in 1998 to expand to other countries like Germany and the United States.

• Advanced charts, custom tables, depth charts, financial news, etc.
• Operational especially for the trading of stocks and futures.
• Execution of orders directly from the charts.
• More than 200 indicators.
• Extensive customization of its graphical interface.
• Ability to download the data history.
• Real Time and Strategy Backtesting.
• Automatic trading system.
• Direct broker access and data history of more than 20 years for backtesting.

Pro Real Time

Pro Real Time is a platform that, like Visual Chart, focuses more on analysis than on execution. Pro Real Time is owned by the French company IT-Finance, which has more than 10 years of experience, 500,000 users worldwide and more than 300 servers managed in different data centers.

• Free tool (although you pay for the data in real time-> you can try to be version for a week without costs).
• Operational especially for the trading of stocks, futures, forex, indices, cfds, commodities, obligations and options.
• Powerful graphics and easy interface.
• More than 100 indicators.
• Possibility to download data history up to 16 years for backtesting.
• Automatic trading system.
• Lightweight version for smartphones
• Customize the platform: fonts and colors, graphics, create custom lists, est.
• Help and support service as well as access to the trading community.