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Best Forex Brokers In The World

By Dugald McCulloch

Republish: EasyPublish™ Published: 23Feb2012 Word count: 420 Viewed: 115 time(s) Get Free Content For Your Site

When it comes to trading the financial markets, there is none bigger than the foreign exchange market. In 2011, it is estimated that more than $4 Trillion was traded every day. This makes the foreign exchange market bigger than the US Stock and Options combined. It is a staggeringly huge market offering investors liquidity not seen in any other market. What's more is the foreign exchange market is open 5.5 days a week, 24 hours a day.

The best forex brokers in the world will offer traders more than just the major forex pairs to trade. The majors are generally considered to be the most frequently traded such as the AUDUSD ("the Aussie Dollar"), USDJPY ("the US Yen), EURUSD ("the Euro Dollar"), GBPUSD ("the Pound or Cable Dollar"), XAUUSD (Gold) and XAGUSD (Silver). You could also include the USDCHF ("the Dollar Swiss"), the USDCAD ("Dollar Loonie or Dollar Canadian") and the EURJPY ("Euro Yen").

The best forex brokers in the world will offer traders the majors as well as cross rates (those that don't involve the US Dollar as the terms currency) and what is known as exotics. Exotics are currency pairs that are less liquid comparatively against the majors. Exotics are currency pairs such as THBDKK (Thai Baht in Danish Krone terms), ISKNOK (Iceland Krona in Swedish Krone terms), EURHRK (the EURO in Croatian Kuna terms) and the GBPILS (British Pound in Israeli Shekel terms).

In addition to the range of foreign exchange pairs, the best forex brokers in the world will offer traders not just the spot instrument to trade but options as well. The forex market generally experiences as much volatility if not more at times than the stock market. It is therefore advantageous to the trader to be able to use options to potentially hedge their spot positions. Forex brokers who don't offer forex options along with the spot market leave the spot market trader with only a stop loss and perhaps a guaranteed stop loss as their only means of risk management. Forex options allow the investor more flexibility in their risk management execution.

The forex market offers traders greater levels of leverage from 50 times leverage up to a staggering 500 times leverage offered by some brokers. Leverage is a double edged sword. With greater chances of reward comes heightened chances of potential risk. Traders should look for brokers who offer a options on a wide variety of forex pairs.

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