CHECKLIST: Before you sign up to an online broker

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Follow this checklist to ensure the online broker you sign up for is secured and right for your needs.

• Ensure your broker is fully regulated and approved

Take some time to read the small print and assess what the relevant regulator offers in terms of protection. Be aware that some multi-regional or global brokers will have had to satisfy more than one regulatory framework.

Countries with dedicated financial regulatory agencies include:

South Africa (FSB) – Financial Services Board.

USA (SEC) – Securities And Exchange Commission (FINRA) – Financial Industry Regulatory Authority

Eurozone (MiFID) – Markets In Financial Instruments Directive

UK (FCA) – Financial Conduct Authority

Australia (ASIC) – Australian Securities and Investments Commission

India (SEBI) – Securities and Exchange Board of India

Japan (JSDA) – Japan Securities Dealers Association

Switzerland (FINMA) – Swiss Financial Market Supervisory Authority

Cyprus (CySEC) – Cyprus Securities and Exchange Commission

• The broker has a safe and secure website and encryption processes to protect from any third-party intervention.
• The broker is fully insured and deals with recognized, regulated banks within the jurisdiction where it operates.
• The broker can ring-fence client funds to protect against it going bankrupt or being asked to cease trading.
• The broker will likely achieve this via a third party, like a regulated bank.
• The broker executes withdrawal and deposit activities within three working days
• The broker has a 24-hour dedicated client live support process that allows for a quick response to any queries the client may have.
• Source any credible broker reviews or client feedback before agreeing to execute through their trading portal.
• It is always useful to learn from other’s experiences. The broker should be willing to provide how many clients it has signed up for.
• Ensure the broker has the availability and range of trading instruments that you require and will not be offering products that are not relevant to your needs.
• The broker has a demo account that a client can try to ensure a better understanding of how the broker operates with your money.

Reprinted from Forexfraud, the copyright all reserved by the original author.