What is the Best Forex Broker? Answering a question with the wrong interrogative word.
What is the best Forex Broker? How about "Who is the best Forex Broker?" The question is good because it plays off a theme that has been preached lately. There are many purporting that their broker or the broker that they are compensated by is the best. The individuals making the claims are doing so to convince you in a ham-handed fashion that they are deserving of the affiliate commissions while not caring about your investments. How does someone determine what is the best Forex broker then? Is this is a question without an answer?
The image above is linked to the actual question on Quora. After all, it is Quora Question Thursday.
The Painful Truth
If someone is vouching for a particular broker without any sort of a service or is spamming to promote a broker, they are being compensated by said broker to spam and provide you with no value whatsoever.
The most popular brokers for the spammers to promote are the ones that offer the highest commissions and there is no concern for the actual traders other than the money generated. It's not a surprise that the highest commissions come from brokers with B-Books (market makers) and that the brokers can easily know which of their clients to take positions against because of who is referring them. If they are hooked by a spammer, they are going to part ways with their money.
The Responses to "What is the Best Forex Broker?" on Quora are Quite Lazy
If you care about the future of this industry, the vacuous responses by those pushing one particular broker are disturbing. Let's review a few and then get into the actual answer to this question because there is an actual answer to the question.
Why is this being discussed? Because it is important to understand who has your back and who is being disingenuous. See it in this fashion as opposed to punching down.
After reading this through this for ten seconds, it became clear that this was launching into a full-on sales pitch that had to come from the broker themselves.
What do you know? It did. It's spammed all over the place.
It does not stop there with the Copy & Paste jobs. No, this is an industry filled with this garbage. The answer is appears to be plagiarize to legitimize a response that promotes a scammy manual signal product with unverified results. No names of scam products will be mentioned here.
What was plagiarized is below. ForexBrokers.com has presumably an original complete guide article with those actual sections, but the spammer above does not include all of those parts referenced and it comes off terribly.
The Good News: The spam and scams appear obvious so anyone with a functional mind would not fall prey.
The Bad News: The spam and scams make the Retail FX industry embarrassing to be associated.
What is the best Forex Broker? Whatever the spammy SEO backlink providers on Fiverr can provide you for $5.
Then there's always a response like this. Are they really trying?
Remember when chain letters were relevant? This is a throwback.
This promotion is now for $1,000 and you really do not get $1,000. You can only only withdraw up to $100 and then the bookie restricts trading on the account and traders have to deposit their own funds to be able to trade again. There's a rollover requirement on the trading volume, just like a sportsbook. The objective is to get you hooked and lose money.
The responses are horrifying, but there is hope.
The answer to "What is the Best Forex Broker?" has an answer. Well, it should be "Who is the Best Forex Broker?", but you get the idea.
It all depends upon what you plan on doing with your investment. This may seem like a wishy-washy sort of an answer, but who told you that you are to have only one broker account in the first place? Who convinced you to just go with a single broker to fit all of your needs? Who is this person or organization?
Think about that. Who on Earth convinced you to do that? Do you wish to be THAT brand loyal that you have to find a broker like it is a spouse? It's going to be a forever sort of a thing, right? Wrong.
If you are trading manually, you are more likely than not just donating your money to whomever has the other side of the transaction. If you are trading with algorithms, PAMMs and Copy Trading Signals, you have a fighting chance and you can diversify the following:
- Your currency pair holdings.
- Your strategies that encompass your entire portfolio.
- Your sub-accounts with a broker.
- Your brokers.
What is the Best Forex Broker? The one that fits the individual strategy within your portfolio best.
Let's re-visit the Smith family.
Jerry thinks that the best broker is the one that gives him a deposit bonus. He trades manually because he is such a Jerry and he does not believe in diversification. He's like 65-75% of the retail FX Market, unprofitable during any given quarter.
Rick thinks Jerry is a fool. Fools part ways with their money willingly. Rick decides to create his own algorithm, copy a few traders trades, and even joined a strong performing PAMM. Rick has an actual portfolio of FX holdings within his portfolio of investments. He may not have invented Jerryboree, but an alternative universe's version of him did. Before Rick even invested any money, he performed his own research.
Rick realized that he needed at the bare minimum a broker that was regulated by a respected regulator and was STP/ECN only. Rick did not want to be B-Booked by a Forex Broker. He also wanted his algorithm to have the lowest spreads for the pair(s) that he traded on his account so he found a raw ECN that met his needs.
He needed the Copy Trading Signals to have minimal slippage and so he researched the brokers that had the least slippage with his desired Copy Trading Signals. He found that each Copy Trading Signal had a different broker with the best situation for him. He signed up with the brokers that met his individualized needs.
He wanted to invest in a PAMM and after evaluating many options, chose a PAMM with a different broker that met his criteria.
Rick made relationships with multiple brokers and over time made adjustments to his portfolio. He left some accounts dormant after withdrawing money and sometimes he re-allocated from broker-to-broker. Rick was in total control, his administrative costs may have risen a little bit, but he was making profits unlike Jerry...
Jerry went to reload his account with a reload bonus from his broker. He felt like he was getting one over on the broker and that he was the smartest man in the room. Jerry was right as he was the smartest man in the room because he was the only man in the room.
What is the Best Forex Broker? It depends upon your situation and how you treat the FX investment. If you diversify, have standards, and look for the brokers that best fit what you are trying to accomplish you will go far.