When you really decide to get into forex trading, to let go of your demo trading account and invest money in Forex, then you have to go through the process of choosing a forex broker. Be aware that you mustn’t take this decision lightly since choosing a good broker will inevitably help to make the most out of your investment. Avoiding Forex trading scams will be part of the process of choosing the right broker.
How to determine if a broker is serious?
If you want to find out if the forex broker with which you plan to open a trading account is serious, it may be interesting tocheck forex brokers reviewsand opinions of traders on the Internet and their feedback on the specific broker. Search Google for the forex broker you want to check out. On specialized forex trading forums, it is also possible to consult the traders’ reviews relating to a specific broker. The Internet is a simple way to get testimonials from investors about forex brokers.
Is your money safe?
When you are about to deposit money into a Forex trading account with a forex broker, you need to make sure that no matter what, that broker will return your money to you on the day you decide to make a withdrawal to your account. The most serious brokers are the regulated ones. These brokers have licenses that prove their serious practices. Licensed forex brokers are permitted to provide their services to local traders and investors. Moreover, this kind of broker generally uses separate accounts to maintain traders’ capital there.
How To Spot Forex Trading Scams?
Forex is becoming more and more popular nowadays that brokers are springing up at the same pace. To detect the potential forex frauds, here are some red flags to be aware of.
Dishonest brokers whose goal is to take advantage of the inexperienced clients, use the churning technique. The goal here is to take as many trading commissions as possible without regard to the client losses. This type of malicious brokers will make unsolicited trades leading the traders to significant losses.
From the perspective of regulatory bodies, this type of manipulation can also be illegal. That is the case with the United States, but also Belgium and Brazil. Blacklisted brokers risk not only license suspension but also monetary fines or even incarceration.
- Brokers with no background
Never go for a broker who doesn’t have transparent information regarding their trading record, fees and commissions, and contact info such as phone numbers, emails, etc. Always check the broker’s regulatory information on their website to ensure brokers comply with market requirements and guarantee fair and honest trading conditions.
- Forex scammers asking for private details
One of the favorite forex scammers’ tactics is to lure with amazing but too good to be true offers sent via email. They will send you emails in aim to market their unparalleled services with low risk and immense returns. In return, you must leave your sensitive information and make a deposit. If this happens, ask for risk disclosure to be aware of risks. Also, always keep in mind your details are valuable to them as much as the money, and they can use them in many unlawful ways.
What to check before choosing the Forex broker?
To choose your online broker, before registering and depositing your money, check the following:
- regulations of the trading website,
- the spreads they offer
- the types of accounts offered
- the user-friendliness of the trading platform
- the quality of customer service,
- Does it include Forex trading training
Forex trading frauds are the reality of the Forex trading market. And they use the most sophisticated means to get you in a trap. But, if you don’t have to take the hard way. Instead, you can enjoy all the magnificent investment opportunities just by checking the reviews and paying attention to the details until you are not sure you are on the right Forex trading platform.