Choosing the right forex broker is no easy task, especially for new traders who lack the experience and the knowledge of how market dynamics work. Often, with so many service providers out there and just as many attractive offerings, it’s easy to get distracted. TibiGlobe supports informed decision-making and this brief guide breaks down 5 important items that should be on every trader’s checklist when searching for a forex & CFD broker.
First things first: Know your goals
Before browsing reviews and checking brokerage platforms, you must know your goals. Establishing what you want to achieve and how fast will help you determine how much you want to invest at first, and eventually, what type of broker can assist you on your journey – an STP (straight-through-processing) broker that gives you access to the FX interbank market where pricing and execution is done by large banks acting as liquidity providers, or a market maker – acting as an intermediary between security buyers and sellers.
This categorisation depends on the way traders’ orders are managed and handled from the broker’s side. Whereas with STP brokers, orders are automatically sent to the liquidity provider, with market makers, orders are mediated by a human agent known as a “dealer”, who routes the orders to liquidity providers.
Additionally, both market makers and STP brokers could be further classified into full-service brokers who provide tailored recommendations tailored to a brokerage plan, discount brokers who execute buy and sell orders for their clients, without any extra services; brokers focusing solely on social trading, allowing traders to copy the trades of experts and share experiences via a social feed; and robo-advisors which are automated investing platforms providing financial services.
Opting for one or another service provider depends on how fast you wish to achieve your goals as well as your trading style and risk tolerance.
Compliance and trader protection
Trading is as exciting as it is risky. This is why when choosing your broker, you should pay close attention to the licences and regulations the broker has. What protection does regulation X or Y offer traders? Depending on their licence coverage and the area where they operate, brokers offer traders a certain level of capital security, such as investor protection, and fund safety with segregated accounts.
By maintaining client money in segregated bank accounts, separated from the company’s funds, brokers ensure that clients will always have access to their cash, even in case of bankruptcy. TibiGlobe is one of the brokers who places great emphasis on its clients’ fund safety, and in line with its FSC (Mauritius) and FSCA (South Africa) licensing and regulation, maintains segregated accounts with top-tier banks worldwide. This way, traders’ funds are safeguarded and accessible to traders at any time upon request.
Fees, spreads, and more beyond the fine print
Understanding brokerage fees can make or break your trading experience. Typically, brokers charge a certain amount in commissions or spread mark-ups. In case you missed our previous article on spreads and how they are calculated, follow this link for quick access.
The lower the spreads, the less cost you incur as a trader. But this is not all, besides spreads, a broker may also charge for deposits and withdrawals. So, make sure you read the fine print before ticking the “I confirm that I’ve read and understood the Terms & Conditions” box before signing up.
Swaps or rollover fees charged for positions held overnight are another category of brokerage fees that traders must be aware of, in addition to asset-specific trading commissions.
Promoting transparency and a trader-first approach, TibiGlobe overtly displays all this crucial trading info on the website, per instrument and account type. No fine print, no deposit and withdrawal fees, no unpleasant surprises!
Additionally, the negative balance protection works as a safety net for Tibitraders, ensuring that everyone can get a fair chance at trading success provided they trade responsibly.
Prioritising low-cost trading, TibiGlobe offers raw spreads, variable per account type, and competitive commissions, ranging between 0 (with the Tibi SPREAD and Tibi PRO accounts) and $6 per lot per side (with Tibi RAW). This allows traders to achieve their goals quicker and more cost-effectively.
Access to educational resources and advanced tools
The next and 4th item on our list is trader education. Does your broker of choice provide access to educational resources and trading tools to support you on your journey? Some may have a more diversified offering than others.
For example, TibiGlobe’s knowledge base includes eBooks covering a variety of topics tailored for beginners and intermediate traders looking to expand their knowledge, ranging from trading basics to moving averages and trading strategies. Free to download, these eBooks cast a spotlight on essential yet complex concepts that require special attention.
A glossary completes the array of resources available to Tibitraders. Defining some of the commonly used trading terms, the glossary is a handy resource for novice traders eager to familiarise themselves with the trading slang.
These theoretical resources are matched by an equally powerful suite of trading tools, including advanced indicators, trading calculators, and an economic calendar allowing traders to make informed decisions and time their entries and exits with confidence.
Smooth payment experience
Ultimately, the 5th and decisive aspect that can determine traders’ choice is the flexibility of payment options. In today’s digital reality, the need to integrate alternative, swift payment methods alongside traditional options is greater than ever.
Numerous brokers have started offering cryptocurrencies alongside more traditional deposit and withdrawal methods, such as credit/debit cards, bank wire, and eWallets. TibiGlobe is such a broker, allowing traders to use the same payment methods they use on the day-to-day, including crypto. Ready to give it a go?
Risk Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Prices can fluctuate rapidly, and past performance is not indicative of future results. Please refer to the full risk disclaimer on our website.
The information provided does not constitute financial advice and should not be relied upon as such. You should seek independent advice before making any investment decision.
