Broker to Trading

Brokers tend to fall into categories, which are based on the different ways traders may trade Forex. These ways are not mutually exclusive; however, brokers may tend to favor a particular type of Forex trading. It has been a trend that some brokers that previously specialized have also widened their appeal.

Roughly speaking, Forex trading could be divided into two broker categories, automated trading and trading performed by the trader, and brokers may favor one type in terms of their feature offerings. To some extent, this is in essence a difference between longer and shorter frequency trading, as shorter frequency trading can be too difficult for humans.

Robots may trade on all time frames; however, it can be seen that brokers supporting automated trading tend to offer rapid order processing and spreads from 0 (plus commission), which can be important in shorter-term trading.

Forex brokers actually offer a wide range of CFD markets (some more than others). However, similar methods may be applied to these markets as with Forex, with a commonality being that these are also traded as leveraged markets. So 'Forex Broker' is a type of umbrella term for brokers offering more than Forex. This page will attempt to choose a 'Best Forex Broker' out of each category as well as provide an 'All Rounder'.

Forex is a vast market and is open continuously from late Sunday to Friday (GMT). This differentiates it from many other markets, which are traded within certain hours during the week. What this means is that there may be a wide variety of trading potential throughout any 24-hour period.

However, the market is structured in such a way that there are times and events that might provide greater or lesser market movement and volatility. These include sessions, which divide the market into times focused towards a particular region and thus may have a greater or lesser effect on certain Forex pairs relative to another session (e.g., JPY pairs for the Asian session and GBP pairs for the London session).

News trading events are typically releases of data for a particular country, and these can have a wide range of effects on affected currency pairs. News events and potential effects are captured in an Economic Calendar, which brokers normally offer (and some trading platforms have one integrated).

Such factors and many others make for a complex trading landscape. There are many approaches to trading Forex and other leveraged CFD markets, including methods based on the human trader, for example, technical, fundamental, and charting analysis, and those based on computer programs.

Brokers that are aimed at the human trader may offer a user-friendly platform, as the human trader might want such a platform, while robots do not have such requirements, except in as much as they are used by the human trader (however, automated trading platforms typically provide tools for the human trader as well).

Automated trading is performed by programs that apply trading strategies (many of which are used also by human traders). There are other approaches to trading Forex, including social trading, where the views of other traders may be examined by the trader, and copy trading, where the trades of other traders are copied.

So to try and capture a 'Best Forex Broker', there are three categories: 'Best Broker: Automated Trading Broker', 'Best User-Friendly Platform', and 'Best Broker: All Rounder'.

Brokers tend to fall into categories; that is, they aim to focus on a particular type of trader or trading (so a pro could be a con and a con a pro, depending on the trader). This is why when choosing a broker, it can be helpful to be aware of the type of broker and what the features offered allow. Availability is subject to regulation, and different features may be offered in different regions.