How to become a forex broker.

Many traders, having realized how difficult it is to trade on the stock exchange, decide to become a broker. Unlike trading, the risk is minimal and the earnings are more stable. So how much do such companies earn?

An approximate profit can be calculated using a simple example: a client opens only 20 trades per month, each with a volume of 1 lot, with a spread of 1 pip per lot, or $10. It's easy to calculate that the monthly profit is $200. It's easy to imagine how much 100 clients would bring in.

Moreover, regardless of the financial outcome of the trades, the main thing is for the trader to open trades more frequently and with as large a volume as possible, hence the leverage of 1:1000 or even 1:2000.

So how do you become a forex broker?

There are several ways to make a profit by providing forex trading services, depending on your available resources.

Broker is an intermediary.

It's the simplest: we register a legal entity, enter into a partnership agreement with one of the best forex brokerages , create a website, and attract clients.

This eliminates the need for software, license fees, or other technical issues. There's

also no need to independently search for liquidity providers.

The only drawback is the profit margin: it's approximately half that of a broker working directly with liquidity providers.

However, this is the approach most start-up companies take, and once they've learned all the intricacies of the process, they can set out on their own.

Independent brokerage company.

In this case, things are much more complicated. While $5,000 is enough to get started in the first option, the amount here ranges from $25,000 to $50,000. And that's without taking into account the license to use the trader's terminal, which is another $75,000 to $100,000.

After this, it becomes clear why most people start with intermediary brokers and only then, having earned a substantial capital, open an independent company.

The amount of initial capital depends on the jurisdiction and some other organizational details.

Becoming a forex broker on your own (registering an offshore company, opening an account, obtaining a license, and concluding agreements with banks) is practically impossible, but there are specialized companies that will do all the work for you for your money.

Probability of earning.

After opening a brokerage company, don't expect clients to simply rush to register and open accounts.

Traders rarely trust new brokers, preferring to work with companies registered more than five years ago.

Therefore, your investment is unlikely to pay off in the first year, and you'll also have to pay for advertising and website promotion. Despite the high profits, brokerage is a rather laborious and expensive process, and the investment doesn't pay off immediately.

For starters, it's best to try your hand at affiliate programs; the most profitable ones are described in the article " Forex Affiliate Programs ."