“Every trader has strengths and weakness. Some are good holders of winners, but may hold their losers a little too long. Others may cut their winners a little short, but are quick to take their losses. As long as you stick to your own style, you get the good and bad in your own approach.”
The concept of trading without a broker in the financial market may seem quite absurd as first. And regarding trading like passing order sell & buy, it’s definitively not something feasible.
But, if we try to answer your question we can say that with currency exchange, a broker may not always be required to carry out trading. For instance, if you decide to travel to a foreign land, do you contact a broker to exchange your homeland currency? You simply visit the bank and get the exchange done.
Forex without broker is based on a similar concept and, at times, can be quite advantageous.
How can you trade forex without broker?
Forex is nothing but currency exchange. If you want to convert USD to Euros, visiting an appropriate bank may suffice. You can always check online the present market quote, find out Euro’s market forecast and visit the bank to convert your USDs to Euros. Again, if the market rises, you can follow the same procedure to convert those Euros to extra USD, thereby making a profit.
Also, there is this concept of currency ETF. These are similar to stocks and are said to move in a sequence with underlying foreign exchange rates involved. To put it simply, say you borrow 1000 Yen due to Japan’s low-interest rates for a span of one year. You can use this to buy a higher interest rate currency to gain from the difference in rates or just wait for the purchased currency to appreciate in value. This is another way of
trading forex without a broker.
Forex trading without broker vs. with a broker
Trading without a broker come with the advantage of not paying any commission from your profits! Whatever you gain due to currency appreciation totally stays with you. However, not opting for a broker’s service also has some disadvantages and may end up working against you. Review some of the notable points in this domain.
- Every broker provides you with leverage. Here, you can trade with huge lot sizes by investing small initial amounts. However, losses incurred on a 200:1 leverage is magnified by that amount, and you may end up losing all your money in a matter of two days. With ETF, it is capped at 2:1 and investment are more disciplined.
- For spot trading with brokers, profit will come only when you make a sell by exceeding the allowable spread margin. Forex without brokerare interest based and are generally paid on a monthly basis.
- Also, most brokers possess appropriate tools to carry out accurate technical and fundamental analysis of the market and provide you with predictions and forecasting. Trading without broker will require you to carry out your own analysis which may not be accurate without proper tools.
- Also, brokers come up with real-time market quotes of multiple currency pairs simultaneously. Hence, you do not have to search every pair every time you decide to place an order.
Brokers do charge various levels of commission from your profits but the services they give are valuable and work for your benefit. However, if you are not at ease with the commission system, you can always
trade forex without broker. You can also opt out of a brokering service after gaining valuable experience. Decide what suits you and make a judicious choice.
Cheers
PipsFisherman
Do not hesitate to follow me,
will be a pleasure to get you on board!
