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BROKER:
- In forex market broker is more important than anyone, because without broker one cannot trade.
- Broker gives you leverage while creating your account along with your deposit some brokers gives you bonus.
- Broker assures you deposit security along with all possible ways of deposit and withdrawal options.
- Some brokers provide swap free accounts for their customers.
- Everyone can open Demo account and can practice forex in live conditions.
- Today, every broker provide minimum two to three platforms for traders along with web based platform.
Let’s us consider a trader, When he quoted to buy/sell broker takes his order and executes it as early as possible, broker searches for best ask/bid rate and executes the order, broker takes care of your trade and calculates it swap rates every day. Brokers controls execution of take profits, stop losses, pending orders.
How does the forex brokers earn?
- There are so many ways to that a broker can earn while execution of trade along with spread they will take some pips.
- If the swap is 2 pips they will make it 2.4 pips and takes 0.4 pips. No matter whether the trade makes profit are loss broker gains amount when trade executes.
- There is scenarion that brokers makes an exact opposite trade to your trade so if you losses he will gain, logic is 95% of traders keep losing so brokers wins.
- Another fishy way is broker’s select top trading account with less draw-down and high gain and copies their trades. From large accounts they take commissions for every single trade.
Finally we can say broker always plays safe but scenario looks like he is giving everything for traders even his profits.
- The most important thing is leverage how does a broker gives that much amount for traders. They are not giving us the money for free, there are giving us credit without interest if position closes in profit/loss he will take his money back and returns our margin.
- Anyone can start brokerage it they have millions of dollars.
How much does forex brokerage firm earns?