Truths and myths about forex brokers
Very often you hear a lot of different opinions about what Forex trading is and how currency brokers work.
Many traders assure that the majority of brokers only want to take money and do not have access to the foreign exchange market.
Their main task is to deceive the gullible average person into their networks and defraud him of money.
How is the situation in reality and which of the existing judgments are myths and which is really true?
In order to understand the essence of the issue, you should have some idea about the work of the Dealing Center and its earnings.
So, let's move on to a review of the most common myths among novice traders.
Which Forex myths may be true.
1. All brokers are kitchens - without access to a real exchange, in practice this is not quite the case; the bulk of brokerage companies are introducing brokers who are branches of large financial groups.
The only drawback in this case is the delay in order execution, because another intermediary is added to the trading process. But thanks to modern technologies, this delay rarely exceeds a few seconds.
Why create a fake platform, spend a lot of money on advertising, attracting customers, and then close down. The costs of opening a broker are so high that they can be repaid no earlier than in a year.
The only ones who raise doubts are options brokers, namely those companies that specialize only in options trading; it has already happened that I myself have personally encountered the disappearance of more than 10 companies in 5 years.
Therefore, if you want to trade options, choose only from trusted companies - http://time-forex.com/brokery-opcyonov
2. The broker drains deposits - this statement is fundamentally incorrect, the trader himself drains the deposit, and the broker can only help him a little in case of technical problems.
Draining a deposit is fundamentally unprofitable for any DC, since you can earn much more from the spread than the main body of the deposit.
In addition, if the client discovers an obvious game not according to the rules, he will no longer return to this company, plus he will spend a lot of effort creating an unfavorable reputation for this broker.
The reliability of this judgment can be easily proven using a specific practical example:
There is a deposit of 150 dollars, which is quite enough to open transactions of 1 lot, the minimum spread is 1-2 points or 10-20 dollars. During the day you made a certain number of transactions with a total volume of 15 lots, as a result, the commission spread exceeded the amount on your deposit, and you can trade for more than one day or month.
3. Fixed spread - this is really one of the myths, since the spread value can safely change several times without your notification, you just need to put the spread indicator in the trading terminal and you will see for yourself.
4. Bonuses are not a scam - you can always get them, but it is very difficult to withdraw them, but they are credited, and the profit received is immediately available for withdrawal, but in order to withdraw the main amount you will need to trade a certain number of lots. Typically, the conditions include an amount from 1 to 5 dollars for withdrawal from one lot.
That is, having made a transaction of 10 lots, withdraw from 10 to 50 dollars of bonus funds. Pretty fair rule.
5. Large capital - many people believe that in order to trade Forex you need a lot of money, this judgment is only partly correct, it all depends on your needs. A few hundred dollars is enough for additional income, and a few thousand for the basic income.
We should also not forget about attracting investors; often the manager of a PAMM account trades an amount of hundreds of thousands, while he has only $1,000 of personal funds in his account. Read about how to open a PAMM account - http://time-forex.com/pamm/pamm-upravlyushiy
Not everything is as sad as it seems at first glance, myths exist, in order to refute them, everything is in your power, the main thing is desire and perseverance.