Online Forex Trading Broker – Learn To Recognize A Fake Forex Broker

With the development of online trading, anyone that familiar with internet will know that there is beter alternative than investing their money on a local forex broker with ridiculously high spread; the alternative is using an online forex broker. They apply much lower spread, no commissions, and allow various types of automated trading systems.

But you must realize that spotting an honest forex trading broker cannot be done by only comparing their services. Many of them are just scam brokerage whose only aim is drain your money as fast as possible and their standard strategy is lure potential clients with sweet promises and benefits. If you want to survive long enough in forex trading, watch for these in your online forex trading broker before making decision:

1. Listed as a Member of a Financial Authority
Checking their register is the first thing you should do. Ask their live support where they’re registered; is it in the FSA? Is it in NFA? Is it any other financial authority? Enter their live chat/mail support and ask for the link to their official registration page; if they won’t give you that, it is very likely that they’re not registered anywhere and it is a sign for you to leave the site right away. For example, read a report of AvaFX online broker to check their register within the FSA.

When you’ve acquired the link, read the entire page thoroughly as sometimes there are cases where the broker registered as inactive member. For example: at the time I wrote this article, FXCBS is registered with the Dubai Gold and Commodities Exchange, but they’re listed as inactive member there.

Additionally, you should check whether they blacklisted by any particular financial authority or not. For instance: both CySEC (Cyprus Securities and Exchange Commission) and UK FSA (Financial Services Authority) have issued warning against Forexyard.

Of course, being officially registered doesn’t mean they’re honest brokers, but it is a good start.

2. You Heard about Them via Incoming Offers that You didn’t Asked
Be careful if you know the forex broker via unsolicited fax or email, especially if they are:
– Sound too good to be true.
– Profits guarantee; every trade in the forex market always has loss potential, so be careful with any high profit promise.
– Trying to have you send your money RIGHT NOW with one-time-offer or other means, but this is only a trick so you don’t have the time to investigate their company.

After you select your online forex trading broker, don’t let your guard down yet; watch for these points:

1. Withdrawal Process
Deposit your fund always a smooth process, but you may not have the same leisure in withdrawal case. If they’re prolonging the process, make it difficult, or do not process it at all, then you’ve found out their true intention.

2. How they Handle Problems
Support always available and very cooperative when you’ve just started being a client, but when a problem arise, you’ll discover their true nature. If they keep giving you empty promise, keeping your money, or even completely ignore you, then they’re scam forex broker.

You may wonder why I don’t suggest checking forums for opinions regarding the broker, but I have good reasons not to do so. Forums are place where everybody can post their opinions, so it is very unlikely to find 100% unbiased argument there as a fake forex broker can pay someone to post fake positive reviews; on the other hand, their rivals can also post negative reviews to damage the broker’s reputation.

The second reason is there are a lot of incompetent novices out there who will always make excuses for their losses and blaming their broker is the first thing they will do; you’ll find many complaints from these novices in various forex forums and these complaints can be very misleading since usually the other traders who satisfy with the broker services won’t even bother to post positive review in forums. This is might not entirely their fault; maybe it is connection issues at a bad time, but nevertheless you’ll read posts about “my broker cut the connection and my profit” and “my platform freeze at a vital time” all over any forex forums.

Please note that I’m not against using forums for information source. I’m just pointing that there are too many misleading information regarding forex broker in the forums, but if you’re looking for other info such as trading strategies or sharing experiences, forums are good place. In fact there is an online forex broker with great forum and community. Read further about them at a review of eToro.

Looking for an honest online forex trading broker is not a simple task and you may have to spend a little time for research, but the result can safe you from bigger problems in the future. Later when you’ve found one that can fulfill your expectation, all that you need is a reliable trading system and you’ll have your income from the forex market in no time. Visit best performed forex broker for a list of recommended online forex trading broker.