Forex Broker Review

Best Forex Brokers Review of FXPRIMUS, GBE Brokers, Admiral Markets, GKFX, ActivTrades, WH Selfinvest, ETX Capital, AvaTrade and AAAFX as well as the Social Trading-Platforms eToro, ayondo and ZuluTrade.

Forexbroker Reserve Liability Leverage Spread Microlots Broker Type Instruments Location Regulation Demo
Forex Broker FXPRIMUS: Forex Broker Vergleich No 1:500 0.3 Pips Yes STP Forex/CFD Cyprus CySEC Demo
Forex Broker Admiral Markets No 1:500 from 0 Pips just Forex DMA Forex/CFD GB BaFin/FCA Demo
GBE Brokers No 1:200 from 0 Pips Yes DMA Forex/CFD Malta MFSA Demo
Forex Broker GKFX No 1:400 1.5 Pips Yes MM Forex/CFD GB ASIC/FCA Demo
Forex Broker ETX Capital Yes 1:400 0.7 Pips Yes MM Forex/CFD/BO GB FCA Demo
Forex Broker ActivTrades: Forex Broker Vergleich No 1:400 0.5 Pips Yes MM Forex/CFD GB FCA Demo
Forex Broker AVAFX: Forex Broker Vergleich Yes 1:200 2 Pips Yes MM Forex/CFD/BO Ireland ASIC Demo
Forex Broker AAAFX im Forex Broker Vergleich No 1:500 1,5 Pips just Forex MM Forex/CFD/BO Greece HCMC Demo
Forex Broker WH Selfinvest: Forex Broker Vergleich Yes 1:100 1 Pip just Forex DMA Forex/Futures/CFD Germany BaFin Demo

Explanation

Reserve Liability: If you trade with over leveraged positions and your balance drops below zero, some brokers ask you to fill up your balance at least to zero. Other brokers take over this risk for you. All these reviewed brokers have implemented sophisticated risk management tools and in 99% of the cases your position will be closed before your margin drops below 10 - 30 %, nevertheless there might be events in the market where is no liquidity in the market (swiss franc event) and the broker can't quote a price.

Max. Leverage: By means of the leverage effect you can trade much more money than your minimum deposit. With a leverage of 1:400 you can trade 400 times your deposit, which is $400.000 with a deposit of only $1000! This is what makes the forex market so lucrative on the one hand and so risky on the other hand. In order to avoid losses you should limit your risk to 2% per trade.

Spread: The spread is the difference between ask and bid price. Most forex brokers do not take fees or commissions but earn their money with the spread. If you go for an ECN account, for example with FXPRIMUS or GBE Brokers, you will mostly have a slight commision but very tight spreads instead. Make sure to switch on bid and ask price in Metatrader 4 that you can see the spread and avoid being stopped out in times of higher spreads (at night). Some traders prefer a higher spread and no commissions, others prefer a zero spread and fixed commissions, depending on their strategy. Depending on your trading strategy and/or your trading hour it can be better for you to choose a fixed or a variable spread. If you are not sure just get in touch with forexbroker-check.com

Microlots: If you only have litte money of lets say between 1000 and 2000 USD/EUR/GBP or even less, please make sure you only trade microlots (0.01 Lot). 1 pip then equals 0,10 EUR/USD/GBP. In general all these brokers offer micro lots for the forex market but not all brokers offer them for CFDs! If you have only a small amount of money please stay away from indices, commodities and other CFDs or sign up with GBE Brokers or ActivTrades that offer microlot trading for CFDs as well.

Broker Type: DMA and STP Broker route their customer's order directly through their liquidity providers without dealing desk intervention. Market Maker (MM) route their customer's orders through a so called dealing desk and hedge positions against their customers. Thus there's a conflict of interest between customer and Market Maker. Nevertheless it can be an advantage to trade with a Market Maker as there's always a price quote even in volatile markets.

Instruments: All these brokers are forex brokers and offer currency trading. Most brokers offer CFDs (stocks/indices) in addition. WH Selfinvest is the only broker where you can trade real futures as well.

Location/Regulation: Where the broker is located and regulated.

Demo account: Most forex brokers offer a free demo account where you can practice forex trading without risk. With some brokers the access is limited in time, with others not. If you just start trading the forex it is highly recommended to take advantage of such a demo account in order to learn forex trading without gambling away your real money. If you don’t know which forex broker to choose open a demo account with several brokers, make yourself familiar with the trading platform and stay where you feel at ease. Once you see how the wind blows start trading with real money. Make sure you run your demo account with nearly the same balance you could afford with real money. It doesn't make sense to manage a 100 K Demo account whereas in reality you couldn't afford more than $1000 for trading.

What can I expect?

Forex trading is normally done via internet. By means of a forex broker that provides a trading platform one gets access to the forex market. The bare minimum of a forex broker is a provision of the trader with charts and graphs as well as an overview of your account in order to see open and closed positions. In addition to charts most brokers offer historical trading data which is required for the technical analysis. Tools to support the trader are mostly implemented in the respective trading software. All brokers provide current economic data and news.

Which Forex Broker is the best?

There’s a couple of forex brokers and there are many opinions on the internet when it comes to question of the best forex broker. We have set up a little poll amongst traders in order give beginners a slight orientation. But bear in mind that there isn’t an absolute “best” forex broker, there are many brokers and each of them have their own advantages and disadvantages. Before starting the forex trading you should ask yourself if you just want to trade currencies or commodities as well, if you want to have access to shares and CFDs, where your broker should be regulated and how much leverage you want to trade. The minimum deposit should be the last option you should consider as effective forex trading starts with a minimum deposit of $1000.

ECN, STP and NDD

There are some confusing abbrevations for beginners when getting confronted with their choice for a good broker. Let's start with a short introduction of the most important concepts:

Dealing-Desk-Broker (DD): A dealing desk broker is a market maker and quotes the price for the customer. A dealing desk broker trades against his customer and wins when he fails. There is a high risk of manipulation with a dealing desk broker.

Non-Dealing-Desk-Broker (NDD): A non dealing desk broker has - guess what - no dealing desk. It is either an ECN or STP (straight through processing) broker. With this broker your order is being routed directly on the interbanking market to the liquidity provider, where the broker gets his quotes from. Re-Quotes are very rare with NDD brokers so as a scalper who wants to trade in volatile phases you should go for a NDD broker.

ECN Broker: There's no dealing desk with a ECN Broker. Mostly the broker takes a slight commission for providing access to the banking market. With an ECN broker the traders trade against each other. So when you want to buy EURO there must be someone to sell EURO.

STP Broker: There's no dealing desk with a STP Broker either. Your order is being routed directly through to the liquidity provider (straight through processing). Normally the STP-Broker is the best choice for scalpers who need to make sure that they get exactly the quote they want at any given point in time.

Registration, regulation and reputation

Take care of the three “re”s: registration, regulation and reputation. Although with some forex brokers the registration process is quite quick and uncomplicated, others want to see a copy of your id, passport and a proof of residence. Don’t take this for annoyance of the broker but for your own security in order to prevent fraudulent use. Is the broker regulated by any national authority? How’s the reputation of the broker? Ask Google for reviews and experiences, take part in discussions and forex trading forums to find the broker of your choice. When it comes to security of funds, FXPRIMUS and ActivTrades pay high attention to their customer's money.

Service and Support

Does the broker offer support via phone, chat and/or email? How’s the forex trading platform documentated? As an English native speaker you will be on the safe side. Forex trading language is English and we don’t know any broker that doesn’t support English speaking people.

Account and fees

If you just want to try out forex trading you don’t need a large institutional account with a minimum deposit of $50.000. Choose a broker with a lower min. deposit and try out forex trading. Many brokers offer mini accounts for private traders. Mind that the only fee you have to pay for participating in the forex market is the spread or a slight commission if you go for an ECN account. Normally forex brokers do not take other fees and commissions anymore as the competition will be strengthened.

The best way to try out a forex broker is by opening a demo account which is free of charge. Almost every broker has such a demo account on offer and thus you can see if you feel at ease with your broker.

Social Trading

If you don't want or if you can't trade for yourself you can follow (subscribe to) successful daytraders and just copy their trades automatically. There are three main social trading platforms on the web: ayondo, eToro and ZuluTrade. Make sure to choose an experienced daytrader to follow who trades successfully for many months or years.

eToro

eToro

eToro is a large social trading network with over 3.5 Million members, regulated within the EU. With the mobile solutions you can trade and manage your portfolio on the road. As a successful daytrader you can make money and sell your trading signals. From 200 Euro on you can follow your top trader(s) and build thus your successful portfolio. More information about eToro

ayondo

ayondo

ayondo is a german social trading network, located and regulated in London (FCA). Via their own broker ayondo markets (former gekko markets) you can trade almost anything you can imagine - even futures and mini futures. As a follower you can build a portfolio of up to 5 top traders. More information about ayondo

ZuluTrade

zulutrade

ZuluTrade is the senior amongst all social trading platforms. Other than with eToro and ayondo with ZuluTrade you can even subscribe to automated trading systems (EAs) and binary option traders. When using ZuluTrade we highly recommend AAAFX as a broker in order to avoid slippage and delayed order execution. More information about ZuluTrade

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RISK WARNING: Daytrading includes products that are traded on margin and carry a risk of losses in excess of your deposited funds. The products may not be suitable for all investors. Please ensure that you fully understand the risks involved.