How to examine a broker?

forexmat

Active Trader
May 24, 2009
3
0
32
Hi,
I have found an interesting article, feel free to read it.
Successful use of scalping is directly depending on your broker. Experienced traders choose brokers very carefully with consideration of many factors.

The first factor, is the spread on the traded currency pair . Most of the brokers give the information about spreads on traded currencies on their websites, but I would recommend to check the spread before you start the trade. I would check the spread on a real account ( you have to open real account, but you can quickly close it and therefore check how quickly you can withdraw money). For a spread checking I would recommend the advisor developed by BJF Trading Group Inc. You can download it here: http://24fx.us/viewtopic.php?f=15&t=10#p1097 for free.

Also, if your broker is ECN, check all the commissions in order to make sure that a broker won’t “eat” all your profit.

Than I recommend to check the execution speed. In order to do this you have to place your advisor to trade with minimum lot and estimate the time interval between the starting time of sending order and it’s ending time. Go to the folder of log files C:\Program Files \metaTrader\logs\ and look on the log file.

Example :
00:56:26 '1003718': order sell market 0.20 USDJPY sl: 0.000 tp: 0.000
00:56:27 '1003718': request was accepted by server
00:56:27 '1003718': request in process
00:56:27 '1003718': order was opened : #1635944 sell 0.20 USDJPY at 91.180 sl: 0.000 tp: 0.000

We can see that advisor made it’s request for opening 00:56:26 and order was opened at 00:56:27 – good work.


You have to also analyze all the teaks around particular order. It will help you to discover manual intervention. Broker can “throw” quotation in the stream of quotations in order to beat your “stoploss” or to give you maximum worst price. That’s why exploring of teaks will make everything clear. Analyze 10-20 orders.

In the future, when you will pick a broker and start the state, I would recommend you to analyze every order. On the website BJF Trading Group Inc. (section Tools) , you can find an instrument AuditTool, that will help you a lot in analyzing orders. And an instrument was created from the will of brokers’ company and was tested by chief dealer.

So analyzing of spreads ,speed and teaks around a order, will give you the full understanding of your broker.
 

terminatorfx

Active Trader
Oct 12, 2009
4
0
32
This is all very nice...if you trade with a Metatrader! What about for brokers that don't have a Metatrader platform, or for brokers that offer both, like mine, but like me the trader prefers the broker's own platform, do you have a link that offers an up to date "real" spread comparison table?
 

Pinalli

Master Trader
Jan 31, 2009
334
4
54
Another important thing you need to check into is the reliability of a forex broker. A safe forex broker will always be attainable for help and advice-24/7. You can read reviews from other traders about which forex brokers are safe and which ones are not. Make sure that you do a lot of research and reading before deciding, so that you will end up with a reliable, affordable, and safe forex broker.
 

reed

Banned
Jun 5, 2013
51
0
0
Nice tip, i think more ways to examine a broker more is to check thoroughly all agreement terms you see there on their site. Be careful to read through well, I took my time reading that of Profiforex's, and what i saw impressed me like their transparency. So I opened an account their.