There are many Forex Dealers active on the World Wide Web, both in legal and illegal ways. Most dealers offer the same services and types of access to the market but their policies and procedures might differ from each other. Therefore we advise for every trader to choose its Forex dealer carefully.
Beginners have to really choose their Forex dealer carefully. The market allows for a lot of trading services, this is also includes services that are not in the slightest suitable for beginners.
There are different levels on the Forex Market and there are brokers on each separate level. Ranging from a high level with direct access to a lower level with little or no access to the Forex Market at all. We will discuss the different types of Forex brokers below
Eeach Forex Dealer handles a user value. Mini accounts, managed account or full accounts are the most used terms. The account type stands for a deposit you’ll make. For example: If you deposit $100 you will be a mini Forex trader, if you deposit $1000 you will be a moderate trader.
Account types list
When you are new to forex trading you could try to have a managed forex account. In this case someone from the forex company will trade with your account for a fee. This system is quite the same as investment advisor. For more details check your Forex Broker.
Bucket shops
Since this type of broker’s legality is questioned, it’s not suitable for beginners. The shops use currency futures and options, have no connection to the market, and – in fact – bet against the trader.
Book makers
This type is much alike a bucket shop, only the bookmaker doesn’t make a profit by winning the bet. His profit is determined by the difference between the buy and sell price of the trade, called the spread. This is what gave them the name “spread betters” or “spread betting companies” In addition, there is no connection to the market and bookmakers are illegal in the US and many other countries.
Retail market maker
despite the fact that this type of broker represents most brokers on the market, they do not provide the same services and access to the market. A lot of traders choose this type of Dealer(also suitable for beginning traders)Nevertheless, one must be aware of the provided services. This type of Forex Dealer is legal in the US, as well as many other countries.
Institutional market maker
This type of broker has the most direct access to the Forex market and is very suitable for beginners. You can be given more direct access to the Interbank market, when you are willing to pay a larger sum of money.
Institutional Forex
This type of Dealer has the most direct access to the Forex market and is very suitable for beginners. You can be given more direct access to the Interbank market, when you are willing to pay a larger sum of money.
As you can see, only four of the five mentioned markets are open to individuals. From these four, the Retail market maker is the most appropriate one. Within this type, there are a lot of different types. However, one must take a look at the services provided by the broker he selects. We strongly advise you not to use a Bucket Shop Dealer or Bookmaker.