Choosing from the pool of competitive Forex broker in Italy is quite tough for a new trader. After all, the Forex market is always fast-paced and challenging not just for small, retail traders but to all traders no matter the type and how big they are. Picking a forex broker is just one of the steps that you have to take if you are interested in Forex trading.
Leverage is often connected when talking about Forex. So, what is really leverage? It is one of the main benefits of trading Forex since it allows you to trade on huge positions without the need to pay the full amount. The most common leverage ratio is 100: 1 which means that a $1 in your trading account allows you to control about $100. With a thousand dollars, you can control $100,000. However, leverage also comes with great risk and you must be aware of it. Most of the time, the brokerage will ask you not to take high leverage especially if you are new to the market to avoid the risk of losing a lot.
Another good news to all incoming traders, in the Forex market, you won’t be charged with commissions. Instead, you will only be paying for the bid/ask spread just like in stocks trading. The trader will have to pay less over a currency that he will sell. You don’t have to worry, spreads are quite small and only take about 0.05 cents. But you must remember that the wider the spread is, the more costly the trading will take a toll on you over the course of time.
Another thing to note is that every brokerage company will not ask you for the same spread. Therefore, it is important to consider these things before you pick a brokerage company that will handle your trades.
Licensed and Regulated Broker
It is very important to deal with licensed and regulated brokers ONLY. These brokerages have proven their efficiency and reputation over the years. With these brokerages, you are ensured that you won’t be scammed. You won’t suffer huge losses because they provide Forex advice and teachings. They are also regulated by a trusted government body task to monitor any discrepancies and illegal activities in trading. Just for these reasons, you know that you shouldn’t deal with shady brokerages that might threaten your trading capital.
Other Important Considerations
First of all, before you decide about the brokerage company, you first need to choose the currency pairs that will be used in your trades. Some of the most powerful currencies always involve the U.S dollar. It is being paired with currencies like the British pound, Euro, Australian dollar, Canadian dollar, New Zealand dollar, Japanese yen, and Swiss franc.
Another thing, make sure that your Forex broker in Italy offers the trading platform of your choice. For Forex trading, the most ideal trading platform will be MetaTrader 4. It is being used by successful Forex traders because it has the right trading tools for Forex, perfect for newbies and experienced traders.