In this episode of Truth About FX, Walter asked which broker is the best forex trader and if he could recommend one. Walter talks about the importance of finding a broker that will allow you to set your own precise lot sizes and how important it is that you know what your powers are and that you are allowed to use them for your advantage.

http://media.blubrry.com/truth_about_fx/content.blubrry.com/truth_about_fx/TAFX_-_EP25_Who_is_the_Best_Forex_Broker.mp3

Download (Duration: 05:03/ 5.78 MB)

In This Episode:

00:54 – being independent

01:39 – calculate your risk

02:09 – lucky or unlucky?

03:16 – not in the same boat

04:37 – do your homework

Tweetables:

Know and understand the power given to you. [Click To Tweet].

Find a broker that will allow you to set your lot sizes.  [Click To Tweet].

Don’t give all of your trading capital.  [Click To Tweet].

Hugh: Alright, Walter. This is a question that I’m sure both of us get a lot. Which broker is the best forex broker?

Walter: Here’s the thing guys, Hugh and I, we could if we wanted to make a whole lot of money. It’s true, I mean, you know it’s true. If in Hugh’s website, Hugh says “This is my broker, you should sign up” and that broker would actually pay Hugh for like every trade that you make if you open up an account with that broker.

There’s a lot of money to be made there but I like being independent. There’s certainly some brokers that I think are better than others. I don’t think that it’s important for me to necessarily recommend one.

What I do think is important though is that you understand the power for you, if you are able to set your lot sizes. If you have a broker who enables you to set your lot sizes, the power that is available to you as a trader is stunning.

In fact, I’ll post a video in the shownotes for this episode so you can see what I’m talking about. Basically, if you think about it, it makes sense. Here’s what happens when you take a trade, there’s a couple of things that can happen.

Let’s say, you’re risking two percent on your system. You see this trade and you want to take it but you calculate your risk–and you’ve got a smaller account, sad to say — so, you have to decide “Alright, what am I going to do here? Am I going to take three lots on this trade and risk one point one percent” Or, “if I take four lots on the trade, I’m going to risk two point four percent.”

What do I do here? Do I risk the three lots which is less than my target two percent or I risk four lots which is more than my two percent? The issue here is that you’re going to get lucky or unlucky. See, you’re going to have some winning trades that have smaller position size than what you want and some losing trade that have larger size than you want.

That messes with your system because it doesn’t give you the true result that you should be getting.