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Is it a Good Idea to Switch Forex Brokers?

By DailyForex.com Team
The DailyForex.com team is comprised of analysts and researchers from around the world who watch the market throughout the day to provide you with unique perspectives and helpful analysis that can help improve your Forex trading.

Switching Forex brokers is something that all traders do sooner or later. The reasons can be numerous, and varied to say the least. Perhaps you have gotten a bad deal at your present broker. It is also just as likely you are looking to trade a currency pair that your broker doesn't offer. Maybe it is leverage. There are actually quite a number of valid reasons to switch Forex brokers.

I can honestly say that the answer to the question posed by the title of this article will vary. Sometimes it is a good idea to switch brokers, sometimes it isn't. This can be because of well-defined variables that you are trying to manipulate in your favor, or it can be for psychological reasons as well. Both are just as common as the other reason.

One of the times that it is a good reason to switch is due to the spreads being charged. For example, there are still brokers out there that have a 3 pip spread on the EUR/USD. While this was the norm a few years ago, it is rapidly becoming considered an outrageous spread in this pair. Leaving for a broker that offers the EUR/USD at 2 pips or lower makes sense as the spread is a "?cost of doing business", and over time can really add up to lost revenue for the trader. Besides, in this day and age, it is the same thing as a broker coming out and saying they are going to take your money.

Another good reason to switch is the broker may have a shaky platform. If you find that the trading platform disconnects quite frequently, or takes a long time to perform a trade, you may want to find a broker that can handle both of those situations. While speed is a relative thing, and isn't as important in normal markets, the fact is that during a meltdown you will want your trades closed as fast as possible.

There are other good reasons to switch a broker, such as a specific pair that you want to trade, margin requirements, regulation and other "?concrete" things. The truth is that not every broker is the same, and some may work out better for you than others. It is like any other business, every company is going to have strengths and weaknesses.

However, one of the most common reasons that people leave a broker is actually a bad reason: shifting the blame. What is meant by this is that people tend to want to push the blame on others for their losses. I have seen many traders talk about how "?crappy" another broker is, when in fact it was their trading that was the culprit! Many of these traders will talk about how the broker didn't give them good fills and other such things. Unless there is a concrete case of the broker slipping you a few pips on your trades, the odds are that you only need to look in the mirror to see why you are losing, not at the broker.

What this means, of course, is that while you may not need to change Forex brokers, you may need to look for help, either via Forex signals or a Forex course. Even better news, of course, is that with proper preparation and support, you can succeed!

DailyForex.com Team
About DailyForex.com Team
The DailyForex.com team is comprised of analysts and researchers from around the world who watch the market throughout the day to provide you with unique perspectives and helpful analysis that can help improve your Forex trading.
 

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