Newbie Looking for Advice on Brokers

[BigEvs]

Hi guys,

I'm new to FX trading and was wondering which brokerage is the best in your experience?

When I say best, I'm looking for safety & security, and also offering decent spreads.

I understand the concept of 'margin call' (I think), but some online brokers (like FxPro) offer negative balance protection. Is this as good as it sounds?

I don't mind risking a bit of cash to make a bit, but I'm a little paranoid that I'd screw up and end up losing a lot more than my initial deposit!

Any advice would be great!

Cheers

 

[BigEvs]

Can I also ask...

I've been doing a lot of reading on various sights and forums, and I keep seeing the advice that you should only risk 1%-2% of your account balance. Now, I just want to make sure I'm clear on what this means.

Say I have £1,000 in my account and want to sell GBPUSD. 1% of my account is £10, so does this mean I would have to trade 0.01 lot size with 100:1 leverage?

Or, is the £10 simply what I'm prepared to lose if a trade moves against me? So, if in the example above, my leverage was 1:1, I would have to stump up £1,000 but by using stop-losses, I could limit my loss to £10?

Apologies for asking a totally amateur question, but I want to make sure I'm perfectly clear that FX trading is for me before dipping my toe in!

Thanks

 

[timsk]

I'm new to FX trading and was wondering which brokerage is the best in your experience?

. . . I understand the concept of 'margin call' (I think), but some online brokers (like FxPro) offer negative balance protection. Is this as good as it sounds? . . .

. . . I don't mind risking a bit of cash to make a bit, but I'm a little paranoid that I'd screw up and end up losing a lot more than my initial deposit!

Hi BigEvs,
Welcome to T2W.

Asking which broker is best is akin to asking who the best mobile network provider is or who makes the best crisps, lawnmowers or laptops etc. It's very subjective and is governed by your trading style and what you want from a broker. I realise this isn't very helpful and doesn't get you any further forward, but my reply on another thread to a similar question might: How to select a Broker?

Negative balance protection (NBP) is a good idea if you're trading highly leveraged products like forex and using the leverage available. The likelihood of a sudden massive move against you may only be slight but, if it happens, without NBP you could end up losing more than you have on deposit with your broker. If you're very conservative and trade with much less leverage than is made available to you, then NBP may not be necessary. Even if you have it, it won't prevent a margin call or losing all your money; it merely caps potential losses to whatever you have in your account.
Tim.

 

[BigEvs]

Thanks for the reply Tim.

I appreciate choosing a broker is a very subjective thing, but I guess I just wanted to find out what other people's experiences were, and whether there were brokers I should definitely steer clear of! I'm thinking of using FxPro, but that's mainly because I set up a demo account with them, and not really done any more research into any others.

Thanks again.

 

[malaspina]

If you consider futures trading please do your own DD on cannontrading