Broker Due Diligence


foreigner

Est. 12480 Hours and Counting
Are you carrying out the necessary broker due diligence before you trade real funds? If not, there are plenty of gambling sites that would love your business!

I recently asked a member of this forum "how do they qualify a broker" and this is what they said;
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"If initial due-diligence gets a pass I will talk directly to a customer service rep and ask any questions I have. Try and throw in a few questions of which you already know the answer.... see if you're dealing with a liar at the very start.

All still good I deposit a small amount of money to test feeds,price accuracy,transaction times, platform stability etc.

Place a couple of phone orders via the dealing desk and see how quickly the phone is answered and how the order is transacted.
Coming from a futures background the phone would be answered within 2 rings. You obviously don't want a broker that values your business so poorly that you get put on hold listening to music!

Also make several withdrawals and deposits to test banking and back office. Finally I withdraw the entire amount of account and see how smoothly this goes. All good I commence operations."

Your gut feel wont let you down. I give a broker one chance per issue. If a particular issue occurs a second time give them the flick.

No use complaining and giving them one more chance. The trader is fully accountable for their money."

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I hope this helps newbies avoid the pitfalls that I and countless others have fallen victim to in the past.

If you have anything to add to this topic please do so below.

Good Luck, Good Trading and Good Broker Due Diligence!

F
 

foreigner

Est. 12480 Hours and Counting
When you enter the world of trading you quickly learn that the markets are manipulated. What your not told is that your broker may be infested by termite technology that depletes your account from right under your nose.

 

Ramy3

May the pips be with you!
SFO investigates price rigging in foreign exchange market
http://www.bbc.com/news/business-28405777
 

AusDoc

Well-Known Member
Ramy3 said:
SFO investigates price rigging in foreign exchange market
http://www.bbc.com/news/business-28405777
There will be a few worried people around then. I hope they deal with the regulators and the politicians. They are the ones responsible for letting bankers believe they are above the law.

If successful prosecutions ensue then banks pay multi-billion dollar/pound/euro fines and look for the next fix and fiddle. The culture of the banks won't have changed so the behaviour won't change. The pension funds invested in banks all suffer when the banks take a share price hit so the pain gets spread around where it doesn't belong. Not very effective justice IMO.
 

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