How to choose a good options broker in the UK?
Choosing a good broker is very important for your future progress and success in trading. This process of choosing a great options trader should be carried out before you open an account with any firm. Since many brokers offer their services, all you have to do is choose from these options.
A few things will ensure your success in this industry when choosing a reputable brokerage firm, and they include reputation, references, and regulatory status. The following will guide you on how to go about this successfully.
Reputation
Reputable traders who have been in business for some time have earned the trust of their clients through excellent customer service and reliable transactions over the years. When looking for a brokerage firm, ask for recommendations from people you trust and check reviews about the company you are considering on different forums.
References
Most reputable brokers will be able to provide you with a list of clients who have been using their services successfully in the past. Phone these people and find out what trading options they used and how successful they made money. You can even sign up with a few of them if their service is good enough.
Regulatory Status
Ensure that the brokerage firm you choose is certified by an appropriate governing authority such as UK’s Financial Conduct Authority (FCA). This kind of certification confirms that the business has your best interests at heart because it follows all regulations regarding data protection laws, rules on unfair trading, best execution, etc. Know your investment objectives
Zero trading costs options brokers
There are many types of binary brokers – some charge commission fees while others don’t while charging on other aspects like withdrawal fees, deposit loans etc. When choosing between non-zero cost fee options brokers, ensure that you check all the associated costs involved in making transactions within the account before investing any money into it. Check if there are hidden charges like maintenance fees etc. which could eat up your profits over time.
Zero/low trading costs is what you should be looking out for when comparing different options brokers. You can conduct a thorough broker comparison and choose the best-suited one for your portfolio within the available list of low-cost online brokers. Many reputed and reliable websites provide free broker comparison quotations.
Minimum deposit requirement
Low-cost options brokers provide a list of services they offer with their respective pricing information, and this includes information on security, software, tools etc. If you have an existing portfolio, choosing between different low-cost online brokers is easier since each broker will have different minimum deposit requirements. Low-cost binary options brokers usually don’t require high initial deposits, while others may offer zero minimum investment amounts for beginners. Do not make any transactions without knowing all relative fees involved in the process.
Account types to suit your investment style.
There are two basic types of binary options accounts: cash or margin. Cash accounts require no money as an initial deposit, while margin accounts need at least £200 as an initial deposit. It is essential to know which account suits you before making any transactions. Once an option expires, it becomes either worthless or has full value, i.e. 100%. Options with full value have a chance of expiry increasing over time, so the value of your account could reduce gradually if left trading for long periods.
Summary
With the above wise words in mind, you can now open an account with any firm of your choice. Just make sure that it is reputable, certified by an appropriate authority and has references from people who can testify to its greatness. We recommend using a reputable online broker from Saxo Bank, who not only offers the lowest commission but excellent customer service as well. For more information on the services offered by Saxo Bank, go to the site.
