Choosing a Forex broker

 Forex Brokerages Leverage One of the major benefits of trading currencies is the tremendous amount of leverage even small time traders are allowed. Typical leverage is 50 to 1, meaning for every $ 1 in your brokerage account, you can control up to fifty dollars in currencies. A thousand dollars would thus allow you to control 50 thousand dollars worth of currency, so if the currency went up by one percent  $ 1,000 you would actually double your money! But if the currency went down by just one percent, you would lose all five hundred dollars of your investment. What would happen if the currency went down by two percent? Well, theoretically, you would lose $ 1,000 above and beyond your initial investment, but in reality, a brokerage firm will usually step in and prevent this kind of loss.

Your main decision is what level of leverage to apply for. Leverage is given based on credit-worthiness, so if your credit report is pretty poor, you might want to pursue just 50:1 leverage which still gives you a lot of room to profit but limits your risk. Alternatively, if you have true nerves of steel and a real knack for forex trading, 

Spreads

The good news is that there are no commissions charged on forex trades. Forex Club has some of the lowest spreads in the forex markets.

The bad news is that, like stocks, forex currency pairs do have a bid/ask spread  meaning a market maker will pay less for a currency than he is willing to sell it for. These spreads are extremely small, usually less than 0.05 cents, but the wider the spread, the more costly trading will be over the long run.

Not every brokerage has the same spreads, so it is important to review the typical distance between the bid and ask prices before selecting a broker.

Other Considerations

First and foremost among all other considerations are the currency pairs that a given brokerage deals in. For example, if you want to perform a Japanese yen for Swiss franc trade, you will need to find a brokerage that offers that currency pair. Virtually every forex brokerage deals in the main currency pairs the U.S. dollar vs. each of the following currencies: The Euro, the British pound, the Australian dollar, the New Zealand dollar, the Canadian dollar, the Swiss franc, and the Japanese yen
Forex traders need to find the best Forex broker this is important for your forex trading success.

The best currency brokers will have a complete set of charts and software for you to use. The charts will be free to use and come along with their services. You should make sure the data transfer is fast and not delayed. Your internet connection should be high speed and connect directly to the forex broker’s charts and trading platforms.