Wednesday October 19, 2016 - 11:35:47 GMT
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Why biggest brokers may not be the best choice?
People quite often associate big names with a high degree of professionalism and credibility. Although this might be true to a certain extent, this is not the general rule. Sometimes small firms offer more a personalized approach to the customer than the bigger ones. This is especially visible in the financial markets. Therefore, in this article we would like to explain that going for the biggest brokers is not necessarily the best option.
First and foremost, big brokers definitely stand on the peak of the hill. They might treat you, the retail trader, as the small fish. In other words, big brokerages mostly devote their time and attention to the institutional investors or high net worth individuals. The ordinary trader might seriously lack the personalized assistance from the broker. This is should always be taken into account. We are not trying to say that the quality of services is low at big brokers, otherwise they would not succeed at building their brand.
Another point to consider is the lack of bonus offers. Small firms are usually new players in the market and they need to attract clients somehow. For this reason, they release different bonus programs, welcome promotions, loyalty programs and other similar things. This positively affects the perception of the broker in the eyes of the trader. Bonuses definitely help in the brand evolution. On the other hand, top Forex brokers in the world are not hunting for every single client, because their worldwide recognition is already a sort of beacon. For retail traders the availability of the bonus is the great boost for the capital. Unfortunately, this is a rarity among large brokerages.
Almost every trader in the world has heard of MT4 at least once. The vast majority is still using this trading platform. Big brokers try to look unique, so they usually develop their own software. Hence, if the trader is accustomed to the MT4 or any other popular platform, he will have to begin learning the big broker’s platform right from the start. This might take a while and the trader can lose some opportunities in the market.
Global brokers have their offices in several countries over the world. This means that the broker has to be regulated in the country where the firm delivers its services. For this reason, to some restrictions or strict regulation the big broker might not necessarily be present in the trader’s country, especially if the client comes from the US. It is better to look for the reputable broker in your region.
In conclusion, being the big brokerage does not ensure the immunity from the bankruptcy or financial hardships. Quite a vivid example is the famous brand FXCM. The company nearly went bust last year after Swiss Franc spike. Although the revenues of FXCM have grown ever since, the firm now faces the problems with the loan. We are leading to the point that the well-known name is not the insurance for your hard-earned invested money.
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Veteran FX Trader, Max McKegg, forecasts all the Major currencies and the Australasians; providing Daily and Medium Term Trading forecasts to subscribers, who include large Banks the world over, as well as individual traders in more than 30 different countries.
