Hi, guys; Andrea Unger here to discuss about the choice of the broker.
Questions come up many times: “What broker to choose?” Well, first of all, I would suggest to look at how serious the broker is and how stable they look in economic terms. Obviously, if a broker goes bankruptcy, it’s an unpleasant situation; I passed through it, and it’s something that, obviously, we all try to avoid as much as possible. So, try to investigate about the brokerage you’re using. Try to look at numbers, and discussions and whatever you have possibility to look at to understand how serious and “in the money” they are; this is very important.
Don’t think about bonuses or other things they are giving you because they are not so important. If they give you something, they have their reason to do so. And you don’t have to make money with their money; you have to make money with your money. Don’t choose one simply because it gives you a higher entry bonus rather than another one. Look at how serious they are—that is very important.
Second, if you are at a different level and you are structured in a certain way, you intend to trade certain markets. Verify what markets are offered through the broker. Not all brokers trade everywhere. So, if you want to trade a specific market because you have expertise of that, look for a broker that offers that market. This is pretty much obvious, but it’s better to doublecheck every time.
And technology—verify the technology of your broker. Verify if the technology they offer is a good match with what you are looking for, what you need. If you are an automated trader, for example, a systematic trader 24/7, and you want something that goes on running with no interruption, verify there are no interruptions on the servers, not of any kind. For example, if you connect a platform to, I mention Interactive Brokers, which is one of the most famous in terms of automated trading services, if you connect to its TWS, you must know that there is one disconnection every day—a planned disconnection. There are workarounds to avoid it, but you have to be aware of that. And then verify if you can cope with it or if you have to find another solution.
Stability, technology, and last but not least, commissions. Well, obviously, don’t start from the commissions. We all want low commissions, this is obvious. Trading costs are not what we love most in trading, but this is the least important thing because we have to verify that we’re getting a good product first of all. And then, we can accept a higher level of commissions if what we get is better than something else. So, look at the commissions, discuss that with your broker, but only as the last choice. First, look for something that you think works, works for the long-term and gives you the technology you need; then, discuss about commissions—last choice, remember. Don’t look for money; look for making money—which is what you’re going to do.
Stay tuned. Ciao.