US Forex Brokers

us forex brokers

Picking the right US Forex Broker is very important, because there are big differences between the platforms.

There aren’t many Forex brokers available to traders from the United States (not licensed and regulated ones at least).

Regulated US Forex Brokers

Why are there so few regulated forex brokers? It’s because the US imposes strict regulations and laws on its finance industry. This provides financial security to all of its citizens.

The advantage of these strict regulations is that you can feel safe with the US brokers that are regulated and licensed.

A variety of trading forms have provided the need for establishing different governing bodies that offer licenses and regulations.

USA Forex Brokers

There are many trading forms operating in the United States and Forex trading is one of the most popular.

It is in fact the leading form of online trading internationally.

The U.S is fairly limited compared to many other countries, a testament to the rigorous standard upheld by prevailing government agencies.

The Primary authorities in charge of overseeing all Forex trading activities in the United States are:

  • the National Futures Association or NFA
  • the Commodities Futures Trading Commission or CFTC.

The key thing to understand about these institutions is that their regulations are not based so much off legal procedures so much as ethical ones for the online trading community.

Forex Brokers That Accept US Traders

Here are some of the top Forex Brokers currently available for traders based in the United States.

1. Forex.com

Forex.com has been around since 1999 and is run by Gain Capital Holdings. It is one of the highest rated Forex brokers anywhere in the world and it meets the licensing and regulatory protocols under the jurisdictions of seven government authorities including the NFA, CFTC, FCA and ASIC.

At Forex.com the types of accounts available to traders are a standard trading account and an Active trader account.

Where the standard trading account requires minimum of $50 worth of an initial deposit to be activated, the Active Trader account requires $20,000. The added benefit of the latter is that traders are supplied with a so called ‘Relationship Manager’ to further assist their trading activities.

There is also a demo account available for all traders with an initial deposit of $50,000.

When it comes to trading costs, spreads and commissions are two very important factors a trader must consider when choosing a Forex broker to work with.

  • For currency pairs such as EUR/USD and USD/JPY, the usual floating spread charged by Forex.com is 1.7 pips.
  • The GBP/USD pair, it is normally 2.1 pips.
  • Active trader account, have a lower spread. For instance for EUR/USD currency pair, it can go down to 0.4 pips.

The trading platform is another important feature offered by a broker. The one offered by forex.com is simple and easy to operate with virtually no room for confusion. Trading options are available in binary, spot forex and CFDs in over 3200 markets.

The main criticisms with this broker is that it offers no bonuses or promotions and variety of available accounts is limited to just two.

2. FXCM

FXCM or Forex Capital Markets is one of the first brokers to implement online trade. It was started in 1999 and is based in the United States. Its headquarters are situated in New York and subsidiaries in the United Kingdom, Australia, France and Italy. It is licensed and regulated by the authorities of each jurisdiction that it operates in, most notably the FCA, NFA, and ASIC.

A diverse range of account types are offered by FXCM to suit novice traders as well as experienced traders.

The standard account requires an initial deposit of $5000 to be activated while the Active Trader account requires $25,000. A mini-account is available as well and requires a minimum deposit of $50. It offers 50:1 leverage for traders based in the United States and 1:200 for traders based overseas. Training accounts are also available at FXCM for 30 days. There are also two types of demo accounts: the standard demo account is available with $50,000 and the mini-demo account comes with $2000. The trading platform used on all these accounts is exactly the same. However, you do need a separate password and ID to access each one.

When it comes to trading platforms, FXCM offers the widely used MT4 platform. It is quite easy to navigate and can be customized to your individual preferences. The available assets to trade include day trading, trailing stop/limit orders and entry orders, and stop loss and take profit.

Customer support from FXCM is available 24/7 in over 20 languages inclusive of weekends and other days when the market is closed. As a trader, you can get in touch over the phone, through email or online chat.

3. Nadex

Nadex is part of the global financial services provider, IG which is worth over 2.2 billion pounds and based in Chicago.

It is a derivatives exchange regulated by the CFTC and only offers assets with limited risks. Its design is mostly in the interests of retail traders. Although, primarily a binary options broker, Nadex offers traders access to financial markets including Forex, commodities, stock indices and crypto currency bitcoins with over 2400 binary option contracts on a daily basis.

When it comes to accounts, traders can maintain just one completely free until they place their first trade.

To continue thereby would require an initial deposit of $250. Apart from that, the account must also hold enough capital to pay off any loss that may result from a trading position. Fortunately, a demo account is available with a handsome deposit of $25,000.

The contracts on offer at Nadex can last anywhere from 5 minutes to a week so traders have numerous trading options to consider as well as being able close off a position before its designated time of expiry.

Bonuses are available here as well. The offer from Nadex rather peculiar. Called the Free Holiday Bonus, it involves traders getting full days where they can trade without being charged with any exchange fees.

Nadex offers support to its customers via phone and email 24 hours a day starting from 6 pm on Sunday to 4:15 pm on Friday.

Pick One Of The Top Rated US Forex Brokers

These Forex brokers are currently some of the best ones operating in the United States as well as internationally. However, as a trader what is most important to consider when choosing which one to trade with is not their popularity so much as how well they can suit your trading style.

Can a Beginner Make Money with Forex

Many people get started with forex trading for the wrong reason. They believe that is a way for them to get rich quick. As with any legitimate trading avenue, however, this is not the case. The short answer to whether a beginner can make money with forex would be ‎‎‎‎‘yes’.

This doesn’t mean that every new trader will make money or that it will be an easy process. Forex is an industry that is advantageous to individuals who understand the specifics and inner workings of it. On that note, let’s take a look at what it takes for a beginner trader to make money with forex:

1) Mastering the Basics of Forex Trading

To be a good forex trader, you first need to equip yourself with the necessary tools. Here is what you need to know about the fundamentals of forex trading:

A Good Broker Is Essential

The key to starting off with an advantage is to choose the broker that is right for you. It is best to stick with a broker that is licensed by the Futures Commission Merchant and regulated by the Commodity Futures Trading Commission. Depending on where you live, you may need to find a broker that is affiliated with an authoritative agency that pertinent to the region.

The other thing to consider when looking for a broker is low spreads. Spreads are the difference between the purchase price and selling price of the currency. They are calculated as pips. In certain trading industries, brokers make their money via commissions. With forex, however, the brokers rely on spreads.

Due to the fractional price deviations with forex trading, traders need their brokers to offer them leverage. You should decide on a broker that gives you the option of either low or high leverage. Depending on the situation, you may need to make use of either of these.

Many brokers need to borrow large sums of money to equip their traders with leverage. They acquire these loans from banks and other large lending organizations. You should look for brokers that are backed by reputable banks to minimize fallout in the future.

Adopting a Strategy

The strategies in forex trading are based on either fundamental analysis or technical analysis. Fundamental analysis typically depends on news reports regarding the various factors impacting currency. Technical analysis, on the other hand, is about identifying the various price trends in the market. Traders can choose to use a strategy that consists solely of these types of analysis or they use one that is a combination of the two. In the end, it is about finding and using a strategy that is in accordance with your trading style.

2) How Beginners Can Make Money with Forex

Now that you know what is needed, how can you make money with forex as a beginner? Here are a few guidelines:

Start with a Demo Account

Most brokers offer traders the opportunity to use a demo account, at least for a limited period of time. A demo account lets you make practice trades without actually investing any real money. This helps you to learn how trades are made and also gives you an opportunity to test out your strategy. All of this prepares you to make your first trade and improves the chance of you being successful.

Do Research

When you don’t have experience at your disposal, you need to utilize the next best thing: knowledge. Fortunately, the forex market has been well researched along with the many strategies that you can use. Reading books, joining forums, and asking questions are all essential to learning how to trade better. It will give you a better idea of just how this form of trading works.

Trade with the Trend

When you are just getting started, your greatest advantage will be to trade with the trend. Trading against the trade could offer better profits but tends to be a riskier option. This is why you should follow the trend unless you have strong evidence to go against it.

3) Forex Trading Mistakes to Avoid

One of the reasons that beginner traders tend to fail is because they make too many mistakes and are unable to recover from them. Here are some of the common ones to avoid:

  • Not being patient and playing the long game when necessary
  • Making too-large trades
  • Letting emotion cloud your trades
  • Focusing on making profit rather than preventing losses
  • Trying to get rich quick

A beginner can make money with forex but you need to understand that it is not simple. It requires study, effort, and most important of all, patience. Only then will you begin to make profits.