The Broker is the financial institution in which we will deposit our funds to open an account and invest in trading. He is the key support to an individual who wants to trade in the live market and earn some profit.
We must check a number of factors to make the right decision as there are many Discount brokers, and each offers a range of variables that must be taken into account.
Next, we will describe the main variables that should be taken into account when choosing a Broker to invest in the trade market.
- The capital that the Broker owns: It is important to know the capital that the Broker has, since at the moment that we make profits we have to be sure that the Broker has enough funds to pay us. In general, Brokers do not reveal this type of information, but you can find out the list of employees working for the broker, how big is the organization, how many customers operate with him, and several other factors can reach our knowledge.
- Market and products offered: We have to know in which markets we intend to operate, and in which products we want to invest. There are Brokers that offer currencies, commodities, futures, among other financial instruments.
- Commissions: There are Brokers that do not charge commissions and that their profit comes only from the exchange spread or differential (the difference between the purchase and sale price of an asset).
If you choose Discount brokers that charges commissions you have to take into account what those commissions are; they can be commissions for the sale, commissions for withdrawals of funds, commissions for maintenance of accounts.
- Spread: Investors always prefer a small spread to pay less to the Broker. Spreads can be fixed or variable. If the spreads are fixed, this means that in times of greater volatility, they will always remain fixed. If the spreads are variable, then in times of less volatility, the spread is lower, but in times of greater volatility, the spread will be higher.
- Services: Brokers usually provide a series of services that can be of great help to traders. Technical, fundamental analysis, recommendations, news and graphics are usually the key. Beginning investors have to take this service into account as the Spanish clients’ managers can assist them in all these matters.
- Customer service: We have to verify if the Broker we choose has people who speak Spanish and can help us with any inconvenience or doubt. There are Brokers that also allow communication through chats, telephone assistance, email, and all this during the 24 hours. In addition, of course, those who assist us must have knowledge in financial markets.
- Trading platform: There are different trade market platforms in the market, it is important first to try the free demo, see what tools the platform has, and if it is complete. In addition, the platforms can be downloaded, without download, for the mobile phone, and more.