When selecting a broker there are multiple different things you will want to take into account to find one to suit your needs.
One of the key things you will want to look for is a broker regulated by a strong regulator. These can include FCA, ASIC or BAFIN. Going with companies regulated by these entities means they have to meet multiple criteria with the regulators and are generally more stable companies. You can also get extra benefits such as the FCA Financial Services Compensation Scheme which covers up to 50k per person. This way even if the broker has issues you are backstopped by the regulatory agency. http://www.fscs.org.uk/
Leverages and Margins
Many brokers will offer very large leverages but this can be a good indication of quality of the broker. Most large brokerages will not allow more than 400:1 leverage and any broker offering more than this you may want to look elsewhere.
Commissions and Spreads
When trading one of the most important aspects when selecting a broker are the spreads or commission you need to pay. The tighter the spreads and lower the commission the better and will lead to increased profits.
For new traders you will want to find a broker that offers a lower initial deposit under 1k USD. You can also find brokers that offer deposit bonuses and other promotions. When looking at the bonus you will want to go through the terms and conditions to make sure you understand the limitations for taking this. This can be in the form of withdrawal restrictions and minimum lots traded.
Ease and Cost of Deposits and Withdrawals
A major indicator of a good broker is the speed of withdrawals. Many jump to the conclusion if there is any hold up there is some sort of scam but this can happen easily within a large broker. When depositing small amount, the cost if done on a percentage base can be negligible but this can eat into your profits so free deposits and withdrawals are preferred.
You will also need to look at the methods they offer. Depending on where you are located, the location of your broker and the ease of sending and receiving funds you will want to find the correct method that maximizes the speed with the lowest possible cost.
Currency Pairs Offered
While there is a great deal of currency pairs for trading, only a few get the majority of the attention and therefore have the greatest liquidity and lowest spreads. These can be EURUSD, USD/JPY, GBP/USD or USD/CHF. Many brokers offer trading in exotic currencies but you will find these have a much larger spread and can trade with greater volatility.
Trading takes placed 24 hours a day so you will want to find a broker that offers a 24hr client service during trading hours. Without this it can leave you in a position where you are unable to get help and could lead to losses on an account for many different reasons.
When considering a broker, a quick call can give you an idea of the type of customer service they provide, wait times and accuracy of answers. Another consideration is the ease with which one can speak with a live person rather than an auto attendant.
The trading platform is very important when selecting a broker as this will be your portal to the market. The added speed, flexibility and analysis features can all help to improve your trading strategy as well results. One of the easiest platforms for FX trading is Meta Trader 4. This is the most popular retail FX platform in the world and it already has thousands of custom built indicators and the ability to write further indicators. These can sometimes be downloaded completely free from www.mql5.com.
Many traders will talk about what type of execution is best, ECN, Market makers, DMA but I would only recommend going with an STP broker. This stands for Straight Through Processing which means that any trades place by a trader will go straight to the brokers liquidity feed and is not stopped by the dealing desk. Dealing desk brokers can reject and hold up trades that can negatively affect your profit. With STP, even if your trades are not being hedged into the market, you know the broker is not interfering with your trade.