Pound coin, money

Why hire a Forex broker?

It is relatively easier to assume that a person can monitor the numbers by themselves, grab the opportune moment and make great profits. But in a market that is decentralised and runs 24 hours a day, it is unlikely that anyone with a day job can keep up with the trends real-time, especially those who are new to the Forex market. Such individuals are going to need the help of a very experienced professional. This is exactly why there is a need for Forex brokers whose sole job is to closely observe the market for the trader and invest their money in the right pairs and get the best returns.

For profitable investments, here are some sound reasons worth considering to hire a broker for Forex trading.

Professional Advice

From the outside, looking in, it appears that luck plays a hand in reaping profits. But in Forex trading, luck only happens when opportunity meets preparation. A skilled Forex broker stays vigilant of the numbers as they rise and fall, remains up to date with the countries’ economies and offers the best advice for the trader’s money. Forex brokerage companies like ETX Capital also offer free seminars to their clients, educating them about the technicalities of trading and the ground basics.

Appropriate Leverage

Inexperienced traders usually start small to minimise their losses. More leverage translates to both high profits and high losses, depending which way the market moves. To reduce losses, leverage has to be kept low as well. Forex brokers provide a varying range of leverage amounts to participants. This enables them to hold a trade position that is higher than the amount they possess. For example, ETX Capital offers a maximum leverage of 200:1, which means if a participant owns GBP 100, they could take a position 200 times their 100 GBP. This increases both the profit and loss exponentially. Hence, an experienced Forex broker will always use the leverage cautiously to steer clear of heavy losses.

Cost-effective solution

Contrary to popular belief, brokers do not drain your pocket. They will take a percentage from total profits as commission which means it is a win-win situation for both the trader and the broker. As stated earlier, they also employ carefully calculated measures to ensure that the stakes are low in every trade that they execute. So even if the market moves against their intent, they do not earn much from it.

It is highly unlikely that new participants in Forex trading will harvest major profits without professional help. Some traders consider using Forex software as a substitute for brokers to monitor trends as they happen. The built-in algorithms in software allow them to identify favourable conditions for investment. However, to deal in a trade that fluctuates with every second, one needs more than programmed interfaces to predict which way the market will move. Also, brokers who have been in the field for long, have inside connections and a greater insight that makes them smarter than computers when it comes to a game where both intuition and shrewd calculations are required to win.

Photograph by Tristan Martin

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