With the development of online trading, anyone who knowledgeable about internet will know that there is better alternative than investing their funds on a local brokerage with ridiculously high spread; the alternative is using an online forex trading broker. They employ much lower spread, zero commissions, and permit various types of automatic trading systems.

Of course, selecting an online forex trading broker is not as easy as comparing their benefits. Many of them are merely scam brokerage whose only goal is drain your fund as quickly as possible and their common strategy is lure prospects with sugary promises and rewards. In order to survive long enough in forex trading, watch out for these in your online forex trading broker before you make decision:

1. Registered in an Official Financial Authority

Checking their register is the first thing you should do. Ask their live support exactly where they are registered; is it in the FSA? Is it in NFA? Is it some 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 AvaFX review 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 stated as an 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.

Confirming their registration is an important step, but even with that you still can’t be 100% sure that they’re honest forex broker.

2. You Heard about Them via Incoming Offers that You didn’t Asked

Suspect every information about forex broker that sent to you without your permission; these are a few things that a scam offers would be:

- Sound too good to be true.

- Guaranteed returns; high returns signify high risks, so beware of any promise that offer you high returns while keeping your money safe.

- Trying to have you send your money RIGHT AWAY with one-time-offer or other means, but this is simply a trick so you do not have enough time to check out their company.

Once you pick your online forex trading broker, don’t ease up yet; watch out for these points:

1. Deposit and Withdrawal

Deposit process always easy, but try withdraw your fund. 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. Support

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 might wonder why I don’t suggest checking forums for thoughts concerning 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 other reason is there are always novices who would blame their broker for their loses and start posting bad things about the broker everywhere while the clients who have received good services won’t even bother to post on forums. This is might not solely their fault; maybe it is connection issues at a bad time, but still you will read posts about “my broker cut the connection and my profit” and “my platform freeze at an important time” throughout any forex forums.

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

Searching for a legitimate online forex trading broker isn’t a simple task and you may have to devote a little time for research, but the result can save you from greater troubles later on. Later when you’ve discovered one that can meet your expectation, all that you need is a dependable trading system and you will have your earnings from the forex market in no time. Visit top forex broker for a list of recommended online forex trading broker.

Tags: fake, online forex trading broker, scam

This entry was posted on Monday, August 2nd, 2010 at 9:00 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.