How do forex brokers make their money?
Forex brokers offer their services without charging a fee. Forex brokers get their share of fee from the other trading activities like purchasing, selling, holding foreign currencies, interest accrued on funds deposited and rollover fees. The Forex brokers do not charge anything extra from the investor. An experienced and veteran forex broker has years of rich experience which prove to be useful in understanding the markets and also guiding the investor accordingly.
It is really amazing how the brokers offer their services without charging a fee for it. The services rendered by a forex dealer are very similar to that of a middleman. Let us take for example as bread middleman. This person purchases bread from the wholesale market at a wholesale price, he then sells it to the retailer. The difference he makes is his profit. In case the bakery store needs to replenish further stock of break, they would contact the middleman. The difference which the middleman charges is his brokerage and his profit as well. more…
