Introduction
As there are hundreds of online sites offering you the possibility to trade currencies, stocks and bonds, it is important to choose the best one for you. Those sites are different in terms of features offered, options, but maybe the most important aspect that really makes a difference is the broker discount.
History
There are some sites that will not even charge you the broker discount. However, we are talking about some free sites, and usually the services of those sites are not that great. If you are looking for a reliable service that is able to bring you some serious money, you can look for a site that has many features and a good broker discount.
the broker discount can be negotiated since you sign the contract. Usually, those discounts depend on the initial sum you are willing to invest. For example, if you want to invest only a few hundreds dollars, the site will probably apply the highest discount they have. On the other hand, if you decide to enter this business with 100 000 dollars, the broker won’t take 10 % as a commission. Moreover, as an investor with serious financial resources, you would probably have the possibility to negotiate the broker discount.
Features
In the case of a site offering you the possibility to trade stocks, probably you will have to pay commissions in any case, but as an old client with lots of money invested, you will probably benefit of a broker discount. In the case of sites offering Forex services, there is no commission involved, as the broker wins from the spread. However, even in this case, you might benefit of a broker discount. This discount is applied to the spread, but usually it is only available for clients with lots of money invested and with a long trading experience.
However, no matter what provider you choose, the broker discount depends on the sum you want to invest. However, the broker discount is not the only aspect you must consider for choosing your broker.
Tips and comments
For example, if we are talking about a broker that offers stocks and bonds trading services, the commission depends on the transactional volumes, but also on the relationship the trader has to the bank. If the broker trades stocks and currencies in large volumes, the banks would probably request smaller commissions from those companies, therefore the respective brokers will be able to apply good discounts for their clients also. if a broker is able to create connections with a large number of banks and financial institutions, he will also be able to apply a serious broker discount for his clients.
Another important aspect to consider while choosing a broker is the liquidity he is able to ensure for attractive spreads. In case you choose a broker that is not able to give you a good discount, make sure the respective broker offers good services for the high price you are willing to pay, such as the assistance of a personal broker or a good and reliable trading platform.
