Forex or foreign exchange is the largest market in the world which basically targets the exchange of one currency to another such as the exchange of euros to Canadian dollars. The market for foreign exchange is quite large; subsequently a medium is required for small scale retail traders that intend to trade on the market. This is where forex brokers come into play. 

Forex brokers are generally mediums that provide retail traders access to the forex market to buy and sell foreign currencies. Forex brokers are usually financial services companies. Lots of forex brokers exist in various countries such as South African Forex brokers.

Roles of forex brokers

  • Retail traders make use of forex brokers to gauge the direction a target currency is going to tune. This is because forex brokers are very famous for their impact in the forex market and they majorly assist retail traders in seeking out favorable prices in the market for each currency. 
  • Some retail traders do not understand that forex brokers are just a small aspect of the total foreign exchange market as it might be quite impossible for little retail traders to trade on the large market; hence forex traders brings the market to them in small volumes. 
  • Most of the forex transactions are generally pairs between the country currencies that are in the G10. These currencies include U.S Dollars, the Euro, the Japanese yen, the New Zealand dollar, the pound Sterling, the Canadian dollar, the Swiss franc and the Australian dollar. Forex brokers then buy currency pairs and sell them to retail traders. If the exchange rate at the time deal is closed is higher, the trader makes a profit; however, if it is the other way around, the trader suffers a loss. 

Forex account 

It so quite easy to open a forex account these days as it is made available on various brokers’ apps. These electronic executions of these trades make it very easy and accessible to various retail traders around the globe. All that needs to be done is to download a forex broker’sapplication on any suitable device. This is then followed by a deposit of money to serve as collateral 

Once this is done, the retail traders can start trading on the platform. Sometimes a few forex brokers’ platforms provide a demo account to enable traders to be familiar with the process of trading before even making the initial deposit. This is a very good approach for new traders as they are able to get used to the trading process and helps to prevent careless unnecessary losses. If the trader is satisfied with the demo version they can then move on to make a deposit and start real time trading. 

Getting an account is made so easy as the forex brokers apps are generally compatible with most devices and are suitable for both Android and iOS systems. 

Although retail trading makes up a small aspect in the forex market, its impact is growing as time passes by due to its increasing exposure.