Don’t Blame the Broker

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It’s just too easy to blame the broker – you lose a trade and blame the broker for stretching the market in order to stop you out. You try to exit a trade at a busy moment and you blame your broker for freezing the platform in order to prevent you from making a profit. You put your money and your trust with the broker and you feel that you’ll leave without them. But before wasting your time in complaining, there are quite a few things to do.

Well, in some cases you could be right. There are some problematic brokers out there and they do such tricks in order to turn your deposit into their revenue.

But if you’re trading with a broker that has no dealing desk, or an ECN / STP platform, that’s unlikely to happen. Such a broker passes your order to a larger liquidity provider and doesn’t play with your order. In such a case,the broker genuinely profits from the spreads, meaning that your interests are aligned with the broker’s interests. More trader success = more trades = more profit.

But also when your broker is a regular market maker, it doesn’t mean he’s stealing your money. if you’re trading with a regulated broker, there’s a smaller chance that this is the case. And if you’re trading with a regulated NDD / ECN / STP you should sure look for the blame elsewhere.

No matter what broker you trade with, you should first check out what went wrong: did you follow your trade plan? Were the Stop Loss and Take Profit orders carefully placed? Did you try to make an impossible trade?

It’s important to remember to first check yourself out. Complaining to friends or on message boards may be a great way to release the pressure, but it sure won’t bring your money back. Checking out what went wrong and learning a lesson will definitely help you make money in the future.

Further reading: 5 Points on How to Chose a Forex Broker in 2011

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About Author

Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned the significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

3 Comments

  1. Pingback: Is the CFTC Actually Helping Traders? | Forex Crunch

  2. While brokers can be of good, bad or in between, I think that the days of them acting against their clients are largely over. Most of them are trying to generate maximum volume, and that is how they create revenue. I am sure we will hear about some inappropriate actions from time to time, but in general, they are just facilitators for retail traders and not their enemies.

  3. TheGeekKnows- Forex Articles on

    Indeed. The possibility of foul play from a regulated broker is low. One should spend effort on evaluating one’s trading plan.