Forex trading market has come the long way. Many brokers have already established a strong positive reputation and gained the trust of traders. However, there is also another side of the medal here. And there are unreliable Forex brokers out there you need to be aware of and avoid by all means. However, how can you detect those brokers? Well, that might seem to be unclear and a hard thing to do. But in reality, it is easier than you think.
Before going deeper into the topic, we would like to provide you with the list of brokers you can definitely trust with your funds and not worry about being tricked in any way. You may see that list below.
CySEC, FCA, ASIC
MT4, MT5, WebTrader
CySEC, CBI, FSA, FFAJ, BVI FSC, FSCA, FSRA
MT4, MT5, WebTrader, AvaTradeGO
SVGFSA, FCA, DFSA, FSCA, FSA
From 30% to 100%
Risk Warning: YOUR CAPITAL MIGHT BE AT RISK
FCA, CySEC, FSA
MT4, MT5, WebTerminal
ASIC, CySEC, FSA, BVI
WebTrader, MT4, TradingView
ASIC, SCB, CMA, CySEC, FCA, BaFin and DFSA
MT4, MT5, cTrader, TradingView
FCA, CySEC, DIFC, CIMA
WebTrader, MT4, MT5, IRESS
MT4, MT5, WebTrader
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
The greatest problem with those scam FX brokers is that they are getting better in what they are doing every day. So, the company might be literally the part of the worst Forex brokers list, but some traders will fall into their “waters” all over again because those guys are professionally creating the illusion of legitimacy in traders’ minds. How they do that?
Just by creating, or hiring someone to create, a good-looking website and indicating that you have licenses from a certain regulatory organization will be enough to trick beginner Forex traders. And even though those might turn out to be scams, those poor guys will swallow the hook again once they see another glistening website of the broker who promises to generate millions of dollars since the first day of trading.
However, we are here to provide you with tricks that will help you to identify unsafe FX brokerage companies and never trade with those again.
Hopefully, with these tips, you will become smarter than the majority of traders that fall in the trap of Forex scam brokers.
That is undeniably the first thing you need to do. By simply doing that you may understand if the broker is reliable or you should stay away from it. For instance, if you see that the broker is regulated by NFA, FSA, CFTC, you can be calm, as those are one of the strictest regulatory bodies out there. However, an important aspect worth mentioning is that you cannot just trust the broker itself. So, whenever you see the regulation number provided on the website of the one, you always need to check it up on the website of the regulator. There were some cases when the brokers from the list of worst FX brokerages where stating that they have obtained the license from NFA, but if you would check their registration number online, you would rather find nothing or find out that the company registered under that number is completely different.
Before you even start trading and choosing the FX broker you want to possibly go with, you need to understand how Forex trading works. That means that you need to clearly realize that you simply cannot earn millions in one day. Thus, whenever you see that the broker is promising you golden mountains and ensuring that you will become a billionaire overnight, you can almost completely be confident that it is one of the Forex brokers not to trade with. That is just like with anything in life, you cannot get something without paying the price of rather time and effort or your money. If you will choose to go with the fraudulent broker, the second will, unfortunately, be the case.
Just proceeding with the topic touched in the previous point, we would like to remind you that if you have only started trading on Forex market, do not await the funds to be returned any time soon. Because there is literally no chance for you getting huge profit out of trading until you will learn about all pitfalls and make some mistakes even. Therefore, try to avoid brokers that are stating that with them you will receive your first returns after a week of trading.
Whenever you see the sparkling promotion banners of the broker online, that is the first trigger for you to be maximally cautious and suspicious about those guys. As let’s face the truth, when something is good, you most probably know about it already, so you don’t need those marketers to tell you about how beneficial and great is their product/service. Therefore, there is a good trick for you to detect the worst Forex brokers out there by looking at their sales pitch. Trust us, if the broker is a scam, it will be outstanding and very persuasive. Cause what other ways there are for those to attract traders and investors?
That is definitely an alarm for you to leave the website of that broker and never return again. When the brokerage companies offer you to trade on the interbank market, there is literally a neon banner saying that it is a scam. As simply that is not the proper way of trading for individuals. Interbank market is like a subsidiary of the Forex market that allows the banks or huge financial companies and institutions to exchange different currencies between each other. Why that is not the right option to trade? Simply because that is the right way to get your money overseas and get lost.
When accessing Forex brokers, don’t just look at the style of the website, take a glance deeper. And you will see that often those glistening websites with fancy buttons and nice infographics do not provide any actually valuable information and fail to support the charts or words about the licenses obtained with the real facts.
That might be easily done now, as there are dozens of review blogs and forums out there that have all those traders with the past experience wanting to share it with others. And trust us, they will not hold back and will tell the truth as it is. So, everything you need to do is actually ask people online about their opinion on one of those presumably worst brokers for trading Forex.
If you really want to dip even deeper, the best thing you can do is to search for people that are somehow connected with the brokerage platform in question. The easiest way to do that is to check their accounts on LinkedIn and see what were their previous projects, what education and professional skills they have. As usually people connected with the cryptocurrency in any way, realize the burden of importance lying on their shoulders and are trying to provide exhaustive information about their professional past. Thus, if you see that the CEO of the brokerage is some random guy who was working as sales manager in a retail shop, for instance, you can clearly understand that something is not clear with those guys. So, it is better not to risk your hard-earned money and go with the brokers that were tested with the time.
Summing up our “how to understand the FX broker is bad” advisory article, we would like to revise everything one more time. As we see that of our utmost responsibility to warn you about brokers out there who are targeting for you, yes, for you. For beginners who are still not fully comfortable with the whole thing happening on the Forex global market. The first thing you need to ensure is that you understand the essence of the Forex trading and how it works. That is important not only because it will help you to avoid the worst Forex trading brokers, but it will also increase your chances of actually earning profit from currency trading. As sometimes beginners lose their money not because of the scammers, but because of their arrogance and attempt to bet against the whole market that has an unlimited amount of funds, well, nearly unlimited.
Before giving out all of your personal information to any of the Forex brokers, you need to first carefully go through a number of main points. Those are the background of the company, as well as of its creators, availability of the valid regulation. Moreover, you need to check all of the conditions of trading and funds deposit/withdrawal. That information is usually indicated in the White Paper of the brokerage and it might seem to be quite boring. But you need to spend your time and make sure to actually read it. You will thank yourself later.
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