First things first. This is not a review of some specially selected brokers, after more than a year trading you begin to know the characteristics of legitimate brokers and random websites that want to take your money. When discovering new brokers you need to always be alert first on the content and kind of marketing material they use and the wording on their website or affiliate websites but here are the main flags
- Mandatory bonus so huge: Have you ever seen a bonus agreement? It locks your funds to the platform that you are unable to withdraw until you trade a turnover of over 25 times the bonus amount. Assume you deposit $50 with a 100% bonus you would need to turn over $1250 on all your trades.
- Too good to be true marketing content: This guy(probably sitting on a gold Bentley) from South Africa makes $650,000 from his phone!! How? (clicks link)* watch your browsers address bar go through more than 3 redirects, sigh! A legitimate broker first of all will not tolerate this nonsense, 2 whenever they mention payouts they will tell you the conditions and the amount invested plus duration of the investment and last but not least they will tell you the risks involved.
- Auto Trading software: This one is a true red flag when your broker has allowed some auto trading software and yet when you ask them for an API for you to auto trade with your own app they tell you they don’t allow auto trading. Why only allow a select few? If you are enabling auto trading why not go all the way? These auto trading software will make huge profits in demo mode but as soon as you deposit money they have a “bad week”. Main reason, the broker uses this auto trading websites to drive deposits to his account.
- Shady trading platform: A good trading platform costs $$$$ which your scammer here doesn’t have so for him a simple chart with call and put buttons paired with a fantastic WordPress site will suffice to fool the majority of you especially when a south African is making $650,000 from his phone. You catch my drift?
- Your phone won’t stop ringing: Yeah since you opened a demo account some one is calling you everyday pressuring you to deposit so you can make money. They don’t even care whether you understand their platform or you even get what Forex is. No. For them you should deposit so you don’t get left behind.
- No/unverified regulation: When you begin trading with a non regulated broker it means that you are trusting they will keep their word period.
- Shady price quotes: A legitimate brokers price will match with majority of major data provides world wide. Corrupt brokers will manipulate their price and thus you never win. So it goes without saying that you need an external source to cross check the quotes and as soon as you notice corruption, fly away.
- Account managers: These guys should only be there to assist you in any way but never to trade for you. They definitely should not have access to your account.
- Withdrawal time: Seems too long? It’s probably too long…. maximum one hour for credit cards and e-wallets and maximum five working days for wire transfers. An no one should call you to give you something special* if you don’t withdraw.
No matter the case don’t bet the farm until you yourself have used the broker and build some trust.