The best brokers to invest in forex

Are you looking for a safe broker to invest in forex? Estafa.info it offers you this page with everything you need to know to choose a legit broker.

If you want to know which is the best rated forex broker in our test, we opted for eToro .

Want more options to choose from? Below these lines we publish a table with the best forex brokers in New Zealand .

* Warning of Markets.com : CFDs carry risk. 73% of traders lose money.

Investing in forex it is undoubtedly one of the forms of investment that can provide the most benefits in the medium term. Therefore, more and more traders and individuals are interested in this type of financial product. Unfortunately, this has also had its negative consequences, usually associated with the emergence of fraudulent platforms that are engaged in conducting scams . The truth is that it is not always easy to distinguish reliable platforms from those that are not. From Estafa.info , a portal that was born as a solution to the arduous task of distinguishing those safe options from fraudulent ones, we bring you a complete guide with the best online brokers of 2018 so that you don't risk it in any of your transactions.

Next, we explain the criteria and factors that we look at to make the table and decide when we can be calm and think that a forex broker is not a scam. We hope that this way, you will not only be able to value our opinions, but you will also be able to compose yours and decide for yourself.

What is investing in forex?

If you like to read press and blogs about investments and economics, you have probably come across the term forex many times. In this case, it is not a new investment instrument. On the contrary, it is a type of investment well known for many years, but that for a while this part is beginning to be called with this acronym in English. Its literal meaning is foreign Exchange and refers simply to the investing with foreign exchange .

The investment methodology is not much different from that carried out with stocks. There are proponents of fundamental analysis, in which the productive situation of the country or entity responsible for producing the currency in question should be taken into account, and there are proponents of technical analysis , which as far as forex investment is concerned seems to be the one that is being imposed. Undoubtedly, in this predominant trend of technical analysis, it has a lot to do with the fact that generally investing in forex is contemplated in the shorter term than investing in stocks, although in reality nothing obliges to it.

What is a currency pair

One of the main features of investing in foreign exchange is that it is always invested in relation to two underlying . That is why currency pairs are usually talked about. A currency pair is nothing more than the ratio of the prices of two currencies. The notation is very simple. Usually the two currencies are indicated separated by a slash, so that the first currency is the base and the second the quoted currency. If for example the NZD/USD pair trades at 1.05, it will mean that we need 1.05 US dollars to buy one dollar.

The names of the currencies were standardized by the ISO 4217 standard in such a way that a currency is expressed with three capital letters, the first two letters being the beginning of the country's name and the third letter the first letter of the currency's name. Thus, for example, JPY is the name of the Japanese yen and USD is the name of the American dollar.

From there the investment mechanics are very simple. If you think the dollar is going to gain value with respect to the dollar you will have to buy dollars, while if you think it is going to lose it you will have to sell it. Therefore, in the forex market there is really no concept of a bull or bear market, since one currency always rises or falls with respect to another, so the movements will always be inverse. Of this form in the market there will always be good investment opportunities , regardless of the time of the business cycle. Of course, the crux of the matter is knowing how to identify trends, in order to take advantage of them. It should always be borne in mind that, when investing in foreign exchange, volatility is quite high and also forex refers to leveraged products.

What advantages does forex trading have

As it happens with binary options trading and the CFDs foreign exchange investment is very attractive because of the great potential for profitability . Undoubtedly, a high potential return has a high risk associated with it, but forex investors continue to increase, because the risk can be easily managed with stops, diversification and good pre-investment analysis. In addition, forex trading has other interesting advantages :

1. It is a market that always has some opportunity . There is always some currency that is about to rise or fall in a high proportion with respect to another.
2. Allow trading up and down , with which the possibilities of risk coverage are also important if investing in other types of assets.
3. It is a market that is active 24 hours . Unlike exchanges, whose markets have a few hours of opening and closing, currencies are always active.
4. Low commissions . Unlike commissions for investing in stocks and ETFs, in forex the price of the trade is only the spread between the buy and sell price.
5. Large capacity of geographical diversification .
6. It can be operated with leverage .
7. There is always liquidity .

Basic concepts about forex

The first time an investor sets out to trade forex, he has to deal with a specific nomenclature. It's not very difficult, but it can be confusing at first. Here we present a small summary of concepts that you will find when you get ready to invest in currency pairs.

Pip

In a very simple way, a pip is the minimum part of a currency that can undergo a variation. The currency quote is very sensitive and in the financial markets it is not limited to the two decimal places that we are used to using on a day-to-day basis. As far as the investment is concerned, a dollar with fifty cents instead of being written like this: 1.50, would be written like this: 1.5000. The quantitative difference is nothing, but for investing it does make a big difference, since the variation of that fourth decimal place can mean a lot of money. The pip is precisely that last decimal that is taken into account when investing. That is, if the dollar goes down to 1.4800 it will have experienced a drop of 200 pips.

Leverage

Leverage refers to the possibility of trading with a large amount of money by simply buying or selling the call or put option that interests us. In this way we manage to operate with more money than we really have. If for example you use a 1:100 leverage, with $1000 you will be trading with $100,000. So if the currency quote goes up by 3% you will earn $ 3000 something that for an investment of $ 1000 is not bad at all. The negative part is that if it goes down, the losses move in the same proportion.

Lot

It is the smallest transaction size allowed by the forex broker. If, for example, an fx broker operates with lots of 1000 units, this will be the minimum amount of monetary units of a certain currency with which you can trade your clients.

Spread

It simply refers to the difference between the purchase and sale prices in the market.

Criteria for evaluating a forex broker

When deciding to invest in forex, one of the momentous decisions is to choose in which FX broker he's going to have surgery. Marketing campaigns are usually quite aggressive and all focused on how much money can be made. Undoubtedly, you can earn a lot of money, but that if you are a good investor does not change regardless of the broker. What does change and a lot is the money that can be lost. If investments go wrong, the online brokers there is little they can do. It's about your responsibility and there's nothing to say. What what is not admissible in any way is to lose money because the broker is a scam and he doesn't want to give it back to us. That's why the first thing you need to make sure is that the broker is not a scam . If there is the slightest suspicion of any type of scam, we recommend that you choose another broker from our list available at the top of this page.

How to tell if a forex broker is a scam

Indeed, the most important factor for you to choose the best forex broker to trade currencies should be the security . But how do we assess if a broker has signs of being a fraud? Here are some checks that should never be missing.

1. Regulations : FX brokers are companies through which the financial markets are reached and, therefore, if they operate with a license in a dollar country, they must comply with a series of regulations. The most important of these is MiFID. Knowing that a broker must meet your requirements is undoubtedly a guarantee of peace of mind.
2. Physical address and contact details : Usually fraudulent brokers do not have real physical addresses. The fact that a broker has one or more locations is a small factor that contributes to us trusting him a little more.
3. Encryption of information : Few companies that are dedicated to receiving online transactions overlook this requirement, but if any are found, it is certainly not advisable to send them money, at least by telematic means.
4. Terms and conditions : Many of the problems in which brokers are accused of scams for not letting the money withdraw are linked to welcome bonuses. That's why in Con, if there is one, we explain them to you.
5. Methods of entry, withdrawal and requirements - Many times they are annoying for customers, but having an identity verification process, before sending the money to customers is mandatory. Without it, any scammer could withdraw your money just by getting hold of your password.
6. Customer service : More than an element of security it is an element of tranquility. In any case, if they do a good job with the information, many unpleasant situations can be avoided. Another small factor to take into account.

By analyzing all these factors for each broker, you will be able to better assess whether it is a legit platform or rather looks like a scam. In Estafa.info we want to help you decide, but we consider it essential that you know what we are based on when making our statements.

Other factors for choosing a forex broker

In addition to safety, there are other important factors. Luckily, there are currently many brokers regulated in dollar countries and licensed, so you can make your first selection among them and then analyze these other features to make your final decision.

The second fundamental factor in choosing a forex broker is its service offer , that is, in which currency pairs will I be able to trade? in addition to forex, does the broker have other investment possibilities? Having a good diversity of offer is undoubtedly a great service for private investors, who have traditionally had to settle for operating in national markets, so expensive to access international ones. Other interesting factors are the possibility of investing from the mobile with an app that is stable, the existence of welcome bonuses and promotions and that has a good variety of methods of income and withdrawal of money.

Finding

Investing in forex is tremendously interesting, both for the vibrancy of the variations and for the great returns that can be obtained. However, the excitement should be restricted to the investment itself, and there should never be uncertainty about whether the broker is going to give you your money back or not. That's why, you must be cuiVegas Palmso with the fraudulent web pages they appear every day on the hunt for unsuspecting investors. Make a good analysis of the broker's security and offer is the basis for making a good decision. Therefore, in Estafa.info we have conducted in-depth reviews and analysis of a large number of brokers. In the table at the top of this page you have a the best FX brokers and in the right column you can see all the available reviews.