There are hundreds of brokers in South Africa, and the questions are how to compare them to each other and then make a choice of choosing one of them. Each broker has its own strengths and weakness that is suitable for certain kinds of traders. This article will showing how to choose the top forex brokers in South Africa by comparing them to each other
In general, we have some common standards to compare brokers to each other:
- Regulation – the major factor in the forex system, which has major regulators and minor ones.
- Trading conditions – the second most important part, which are the detail of what brokers provide to traders.
- Account types
In common, governmental regulatory agencies set rules to manage forex brokers. We call them the regulated brokers, which follow those rules above to create the safe trading environment and protect funds for traders. The trusted licenses are often FCA, FSCA, CySEC & ASIC. Also, the regulated brokers by many agencies are believed to have more trust and integrity.
There are 3 things regarding to the reputation such as regulation, trade execution method, and client fund management.
As mentioned above, the brokers with many major regulators have more trust and integrity. They are also safe for all traders.
Execution of trades are evaluated in many ways. We have to check if a dealing desk is included in the execution or not, if there is any conflict of interest between the brokers and traders or not, if there is any incentive for brokers when you lose your trades or not. If such things like that happens, it can indicate the brokers are less reliable.
It is important to manage clients’ funds efficiently and safely. These funds should be separated into different accounts at major banks in local jurisdiction in case of the bankruptcy of the brokers.
We are talking about spread and leverage mainly.
Spread is the difference between the Bid and Ask price. It is measured in pips. It is wide if the difference is large, and it is tight when the difference is little. As a result, traders prefer the brokers with low spread and low trading cost.
Leverage is used to increase the size of trades, which is very useful for traders. For example, a leverage is 850:1, which means that the size of trades can be increased up to 850 times of the original size. We can imagine how hard it would be for individual retail traders if there was no leverage. There are different leverages provided by different brokers, which are also based on the trader’s experience.
There are 3 types mainly: live/ real account, demo account and swap-free account. There is also managed accounts but very rare.
There are real condition, cost of transactions, price, money and profits…in this account. All what you do in the transaction will affect the account balance. Open Exness accounts now.
There are unreal condition, cost of transactions, price, money and profits…. There is not risk and it is very safe for beginners to practice and experience in the customer service, trading conditions, research area,…of a broker.
In short, above are the most popular standards for the best forex brokers in South Africa.
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