Broker to Trading

These brokers are well established brokers offering currency trading. They provide currency trading platforms to enable to trader to trade the foreign exchange (currency) market online.

What is online foreign exchange trading ?

Currencies are exchanged all the time across the world. Banks play an important role in this process, processing large volume orders. There is no central authority setting an exchange rate, at least for major currencies. This is a decentralised market. However central banks may seek to influence the rate at which their currency is exchanged against another currency, and have various mechanisms to do so.

The exchange rate is set in the Foreign Exchange Market, and can vary due to a range of factors. Since the exchange rate can change in a way which is not deterministic, it can be traded. Because the changes in relative valuations of currencies is not set and is not based on an algorithm of some kind (it is not known how an exchange rate will change in the market in advance) traders must speculate. Traders are not necessarily engaging in speculation only for the sake of speculation, as changes in the exchange rate can directly affect businesses and others who need to make use of currency exchange.

Traders include both human traders and computer programs executing automated currency trading with participants ranging from the very small to the very large. What are traders doing ? They are seeking to speculate on the movement of the currency, as the various factors affecting it change its value relative to another currency (i.e. its exchange rate) and use various methods to try and deduce what this might be.

Currency trading is expressed as trading a currency pair of one currency valued against another. Retail traders do not buy or sell any real currency but rather speculate on the movement in value of a currency pair through an online currency trading company (i.e. a broker). Some traders seek to trade more directly into the currency market. Brokers may offer ECN services to cater to them which can offer different levels of market access to connect traders with liquidity.

The difference between human traders and computer programs can be essentially one of discretion vs speed and accuracy. Computer programs allow the trade to trade in a way or use strategies which they may find difficult or impossible to implement themselves. Conversely, the human trader can exercise discretion and apply their own experience, knowledge and judgement of the the market and trading to enter, manage and exit a trade.

Top 5 Currency Trading Companies

These brokers have been chosen because they are well known regulated currency trading companies offering online trading platforms which support the core styles used by currency traders, trading where the trader makes their trading decisions and trading where a computer program (trading robots) trades on behalf of the trader implementing automated trading strategies. The Foreign Exchange Market is complex and traders may use different strategies depending on a range of factors. The flip side of complexity is that there are many ways to approach trading this huge market, from using different technical indicators in different ways, to using all sorts of fundamental data to help analyse a currency pair.