Use this checklist before committing your money to any broker.
Here is my checklist for my forex brokers
| Item check | What is expected | Comment | Importance |
| USD/JPY Spread – Raw Spread | 0 pips to 0.5 pips Commission per lot <$40 | Measure within the 30 min opening of the US Session I always choose raw spread if available | Critical |
| USD/JPY Spread – No Commission Spread | 1 pips to 2.5 pips Commission per lot =0 | Measure within the 30 min opening of the US Session | Critical |
| Negative Balance Protection | It is a good to have item | Not really required if you are a trader with a good money management. If you keep blowing accounts, this is a must have item for you | Critical if you are newbie Optional if you are not |
| Is your Broker a Reputable Broker | At least a 5 years history at the very least Have they passed trust pilot? Are they a listed company What are the common complaints about the company? | I would prefer at least 10 years history (that will really eliminate a lot of actors) A lot of complains? more than 5 a month? What type of complains are they? If they are listed company in USA, I will deem them the safest | Critical |
| Country of Incorporation of the broker | Australia, Singapore, USA, Switzerland, Canada, United Kingdom | I will consider these brokers that are regulated by the local authorities reliable. This does not mean that other countries are not good, just that, there is a higher possibility of bad actors. | Important |
| Processing time How fast did you trade execute | I expect the trade to execute in less than a second. I will expect the trade to be executed as soon as I click it | If you trade takes more than 1s execute, reconsider this broker. Do note that, sometimes your computer is just plain slow hence every trade is 1 second or more In all my accounts, I have not gotten any re-quotes | Critical |
| Margin Trading | 20x to 300x | I recommend using 20x at first and go higher as you get better. 50x will be a nice level. | Important |
| Customer Service | Live chat, a phone number to call, email for support and optional whatsapp channel | You don’t really need customer service until you really need one. When you need one, often it is urgent. Always try out the customer service to see how fast they can handle your query. (Excludes, how fast they get back to you when you open your account) | Important |
| Funding Option | Credit Card Cash funding that is transferred to your local bank | I always prefer credit card especially if the broker covers my fees. As funding with credit gives me a added level of assurance with the ability to do a charge back when things goes south If I get rewards for charging my credit card is adding icing to the cake When funding is done to your broker into a local bank account, that’s gives me added assurance. | Optional |
| Withdrawing Option | 3 to 5 working days for funds to reach me. Often it is 1 working day and less for me | When the broker does not have a local bank account in your country, it will take a few days. Often when the broker has a local bank account, my funds reached in within 1 working day | Important |
| Funding Currency | USD or my local currency | I will prefer to use my local currency but the next best thing for me is USD | Optional |
| Carry Interest / Swap Interest | Do you need to pay/get paid for overnight hold on your trades? What are the administration charges? I will consider 1% or less. | Often when you hold your trades overnight, there are swap interest charges. You receive or pay for it will depend on the currency pairs. An admin fee will be charged. | Important |
| Relationship Manager | Often when I deposit more than USD$10k, I will expect a relationship manager attached to me | When you have a relationship manager or a team that is assigned to you. Your issues if any, will be address quickly | Optional |
| MT4 / MT5 | I always trade with MT4 if possible | It will be good to have a common and recognized platform like MT4 and MT5 | Optional but good to have |
| Country of operations | Services must be available in my country | Not every broker accepts account opening in any country. Always check / email the broker first before you commit real funds to it. | Critical |
| Language Available | Do this broker provide support in your native language? | Not all of us speaks English so it is always good that the broker can communicate in your native language | Optional |
| Type of Broker | ECN (Electronic Communication Network) or STP (Straight Through Processing) | This is the only brokers I will deal with | Critical |
| Guarantee Stop Loss | Definitely a good to have option. | This is definitely preferred when the currency you trade is very volatile and especially during the time that you are not in front of your computer or when you are sleeping | Optional but good to have |
See also: Brokers I use now | Brokers I stopped using