Hints for comparing forex brokers

Comparing forex brokers is a cinch for those already familiar with the lingo used by forex traders such as pips and spreads, lots and mini accounts. For those not in the know, it’s highly recommended that you read the ABC of forex or visit our Wiki, Investorpedia.

The costs of trading forex are in the pip (or spread). The higher the pip, the more brokerage you pay each time you open and close a forex position. Remember that smaller is better as far as pips are concerned. As you can see in the table, more liquid currency pairs called the 'majors' are cheaper to trade - or have lower pips - than the more exotic varieties.

Other points to look out for is the deposit required to open an account, the type of accounts offered - mini and standard - and how much leverage you can employ on a trade. Mini forex accounts are tailored to newcomers to forex trading, since you can open an account with a smaller deposit and trade smaller contract sizes (1/10th the size of a standard contract).