What are Your Options Regarding Forex Options Brokers?

Forex option brokers can generally be divided into two separate categories: forex brokers who offer online forex option trading platforms and forex brokers who only broker forex option trading via telephone trades placed through a dealing/brokerage desk. A few forex option brokers offer both online forex option trading as well a dealing/brokerage desk for investors who prefer to place orders through a live forex option broker.

The trading account minimums required by different forex option brokers vary from a few thousand dollars to over fifty thousand dollars. Also, forex option brokers may require investors to trade forex options contracts having minimum notional values (contract sizes) up to $500,000. Last, but not least, certain types of forex option contracts can be entered into and exited at any time while other types of forex option contracts lock you in until expiration or settlement. Depending on the type of forex option contract you enter into, you might get stuck the wrong way with an option contract that you can not trade out of. Before trading, investors should inquire with their forex option brokers about initial trading account minimums, required contract size minimums and contract liquidity.

There are a number of different forex option trading products offered to investors by forex option brokers. We believe it is extremely important for investors to understand the distinctly different risk characteristics of each of the forex option trading products mentioned below that are offered by firms that broker forex options.

Plain Vanilla Forex Options Broker - Plain vanilla options generally refer to standard put and call option contracts traded through an exchange (however, in the case of forex option trading, plain vanilla options would refer to the standard, generic option contracts that are traded through an over-the-counter (OTC) forex dealer or clearinghouse). In simplest terms, vanilla forex options would be defined as the buying or selling of a standard forex call option contract or forex put option contract.

There are only a few forex option broker/dealers who offer plain vanilla forex options online with real-time streaming quotes 24 hours a day. Most forex option brokers and banks only broker forex options via telephone. Vanilla forex options for major currencies have good liquidity and you can easily enter the market long or short, or exit the market any time day or night.

Vanilla forex option contracts can be used in combination with each other and/or with spot forex contracts to form a basic strategy such as writing a covered call, or much more complex forex trading strategies such as butterflies, strangles, ratio spreads, synthetics, etc. Also, plain vanilla options are often the basis of forex option trading strategies known as exotic options.

Exotic Forex Options Broker - First, it is important to note that there a couple of different forex definitions for "exotic" and we don't want anyone getting confused. The first definition of a forex "exotic" refers to any individual currency that is less broadly traded than the major currencies. The second forex definition for "exotic" is the one we refer to on this website - a forex option contract (trading strategy) that is a derivative of a standard vanilla forex option contract.

To understand what makes an exotic forex option "exotic," you must first understand what makes a forex option "non-vanilla." Plain vanilla forex options have a definitive expiration structure, payout structure and payout amount. Exotic forex option contracts may have a change in one or all of the above features of a vanilla forex option. It is important to note that exotic options, since they are often tailored to a specific's investor's needs by an exotic forex options broker, are generally not very liquid, if at all.

Exotic forex options are generally traded by commercial and institutional investors rather than retail forex traders, so we won't spend too much time covering exotic forex options brokers. Examples of exotic forex options would include Asian options (average price options or "APO's"), barrier options (payout depends on whether or not the underlying reaches a certain price level or not), baskets (payout depends on more than one currency or a "basket" of currencies), binary options (the payout is cash-or-nothing if underlying does not reach strike price), lookback options (payout is based on maximum or minimum price reached during life of the contract), compound options (options on options with multiple strikes and exercise dates), spread options, chooser options, packages and so on. Exotic options can be tailored to a specific trader's needs, therefore, exotic options contract types change and evolve over time to suit those ever-changing needs.

Since exotic forex options contracts are usually specifically tailored to an individual investor, most of the exotic options business in transacted over the telephone through forex option brokers. There are, however, a handful of forex option brokers who offer "if touched" forex options or "single payment" forex options contracts online whereby an investor can specify an amount he or she is willing to risk in exchange for a specified payout amount if the underlying price reaches a certain strike price (price level). These transactions offered by legitimate online forex brokers can be considered a type of "exotic" option. However, we have noticed that the premiums charged for these types of contracts can be higher than plain vanilla option contracts with similar strike prices and you can not sell out of the option position once you have purchased this type of option - you can only attempt to offset the position with a separate risk management strategy. As a trade-off for getting to choose the dollar amount you want to risk and the payout you wish to receive, you pay a premium and sacrifice liquidity. We would encourage investors to compare premiums before investing in these kinds of options and also make sure the brokerage firm is reputable.

Again, it is fairly easy and liquid to enter into an exotic forex option contract but it is important to note that depending on the type of exotic option contract, there may be little to no liquidity at all if you wanted to exit the position.

Firms Offering Forex Option "Betting" - A number of new firms have popped up over the last year offering forex "betting." Though some may be legitimate, a number of these firms are either off-shore entities or located in some other remote location. We generally do not consider these to be forex brokerage firms. Many do not appear to be regulated by any government agency and we strongly suggest investors perform due diligence before investing with any forex betting firms. Invest at your own risk with these firms.

Forex Online Brokers List

	Brokerage Company offering foreign currency trading services
Company Name: HY Markets » more info Company Name: Dukascopy (Suisse) SA » more info Company Name: GFX Group SA » more info Company Name: MONEYFOREX FINANCIAL LTD. » more info Company Name: Western Capital Forex » more info Company Name: FxPro » more info Company Name: OANDA FXTrade » more info Company Name: ACM Advanced Currency Markets SA. » more info Company Name: MF Global UK Limited » more info Company Name: MG Financial Group. » more info Company Name: Capital Market Services LLC. » more info Company Name: GCI Financial Ltd. » more info Company Name: Saxo Bank A/S. » more info Company Name: Alipes Investment Inc. » more info Company Name: Synthesis Bank » more info Company Name: Global Forex Trading. » more info Company Name: swissDirekt » more info Company Name: Commerce Bank Foreign Exchange » more info Company Name: Titan Financial Group Ltd. » more info Company Name: ForeFront Investmenet Group » more info

Forex broker, learn about currency trading brokers

brForex Broker

There are now hundreds of online forex brokers available. You can actually search on any search engine and receive numerous results. Most forex brokers offer practically the same tools and may differ only very minimally in the processing fees. What you will be required to do is to open an account with a forex broker and deposit money into that account. Some would offer free trading advice while others would let you try trading in a simulated forex currency market with a practice account of $50,000.

A forex broker will usually also offer basic lessons on online trading or maybe give training through email. A good broker will often have 24-hour customer service which ensures that the technical glitches that might arise will be fixed immediately, especially since currency trading is such a fast-paced endeavor.

It would also be beneficial if you make sure that the forex broker has a reliable security system because if you succeed in online trading, sooner or later you might be trading in high volumes and it would be unfortunate if this will be lost due to lack of security.
Our pick for the Best Forex Broker is Easy Forex they meet all of the above criteria and more.

They offer:

* Live training, with one-on-one help
* Personal account management
* Start trading in less than 5 minutes
* Start trading with as little as US$25
* Credit Card or PayPal use for instant Deposit
* Guaranteed Stop-Loss Rate
* Freeze the Rate you see (Freeze&Trade)
* No hidden costs, Competitive spreads
* Special Terms for frequent traders
* No download to software
* Live Quotes, real-time
* Full Transparency
* Security and Safety

Forex Trading Analysis

Many believe that with the advent of the internet, online trading has become much simpler. On the contrary, forex currency trading has only become much more complicated with the many participants all over the globe and the fluctuating currencies of different nations. Even the economy has become more unpredictable. What is true is that anyone can jump into the forex currency trading market but there are no guarantees as of success.

A forex trader buys currency with the expectation that its value will eventually rise. When it does, it is wise to sell the currency or trade it. This picture is simple enough to grasp but once you actually get into forex trading, you will see how complicated it becomes.

While success is almost never guaranteed, there are tools which can help you get ahead of the millions who have joined the forex market.

Forex Trading Systems offer software which may help in analyzing the trends in the currency market. There are several kinds of systems. Some offer free and up-to-date news on currency trends while others organize historical data into simplified charts which can show you the trends and behavior of the market. After a while, when you have become accustomed to the patterns in the currency market and you that there are lesser risks if you go by your own routine, you can use platforms with which you can automate your buy or sell instructions so that you would not have to be in front of the computer all the time.
Forex Basics

More than anything, to ensure that you will not be left behind by your fellow forex traders, you must have a reliable internet connection and reliable computer. Remember that online trading is fast paced. Changes often occur in seconds and it will be to your disadvantage if you are held back by internet down time or worse, a computer crash. Make sure that your computer is protected from hackers and viruses.

In forex currency trading, the time you would take for changing connections or computers would always be considered wasted time. Before getting into the forex market, make sure that you can depend on the basic tools you use.

So with a reliable forex broker, a good trading system, a dependable Internet connection and a stable computer you are well on your way to making your millions in the forex market.