You must have seen advertisements for forex trading boasting high leverage and profits. Although it wouldn't be fair to claim that all claims are false but one can say that they are exaggerated to attract investors. It can certainly lead you to prosperity if you have a solid strategy and thorough analysis.
This is where a forex broker becomes necessary. This article will explain the purpose and motivation for brokers in the money markets.
Forex trading, as many people know, is primarily OTC (over-the-counter) in nature. What does OTC stand for? OTC stands to represent 'Non-Exchange Traded'. Let me expand on this. Trading occurs on one or more stock markets in the case of futures and equities. OTC products include forex. Trading that involves buying and selling OTC products is done between private parties. They are generally more expensive than any trade for futures or equities. To find the best trading brokers in South Africa, navigate to https://www.globex360.co.za.
OTC trades, on the other hand, are not restricted to a specific location such as a stock exchange.
Referring to forex trading, OTC means over-the-counter banks and financial institutions that trade currencies in millions or more.
It is a significant part of global currency trading.
You might be wondering how it is possible to start a business starting with only a few hundred dollars. However, advertisements claim that you can start with as low as $500. Brokers have made this possible.
Forex brokers are intermediaries between large traders and retail traders on the larger market.
Brokers are needed for a few reasons. First and foremost, brokers allow individual retail investors to access the forex market through brokers. All brokers trade with small retail investors.