How To Choose An Online Broker For Currency Trading

With major advances in technology there has been a boom in trading currencies online over the past decade. With so many online forex brokers to choose from, it is important to do your research before opening an account.
The majority of online currency brokers are market-makers. Usually when you buy or sell a currency, you are dealing directly with the broker. This means that you buy from the broker and sell to the broker. The advantage of this is that most brokers that are market-makers will let you trade whatever currency you want at any time.
Online currency brokers will usually offer variable spreads or fixed spreads. Variable spreads will fluctuate depending on how heavily a certain currency pair is being traded. Fixed spreads will remain the same no matter what is going on in the markets. Variable spreads are typically favorable to short-term traders while fixed spreads can benefit longer-term traders.
Another type of online currency broker is the one that claims to be a non-dealing desk. This means that they advertise to be giving you the trading price straight from the interbank market. Most legitimate non-dealing desk brokers will offer very tight spreads and charge a commission for the trade.
There are increasingly more and more brokers that offer online currency trading. It is extremely important to do your research before choosing a broker. There are many online sites that compare and review different forex brokers. Taking time to choose the right broker for you should pay off in the long run