Verify the exact legal entity and licence
Check the company that will contract with you, not only the group brand. Match its legal name, licence number, website, contact details, permitted services, and any warnings in the regulator’s register. Regulation reduces some risks; it does not guarantee profits or prevent failure.
Understand client-money protections
Read how retail money is held and whether it is segregated from company funds. Compensation schemes, negative-balance protection, custody arrangements, and insolvency treatment differ by entity and country—marketing for another branch may not apply to you.
Review execution and conflicts
Labels such as STP, ECN, or market maker do not tell the whole story. Read the execution policy: venues or counterparties, price sources, slippage, requotes, rejected orders, stop handling, and how the broker manages conflicts when it is the counterparty.
Calculate the total trading cost
A tight headline spread may exclude commission and financing. Compare spread plus commission, overnight swaps, currency conversion, inactivity charges, data or platform costs, and deposit or withdrawal fees for the pairs, position sizes, and sessions you actually trade.
Test the platform and order controls
Use a demo account to check stability, mobile and web access, server time, price history, exports, alerts, and the order types you need. Confirm rules for stops, limits, partial closes, hedging, FIFO, margin changes, and outages before relying on automation.
Test deposits and withdrawals
Review identity checks, supported payment methods, name-matching rules, limits, processing times, fees, and third-party payment restrictions. After verification, complete a small deposit and withdrawal using the same route you expect to use later.
Control leverage and liquidation risk
Higher leverage reduces the margin required but magnifies how quickly a move affects your equity. Check margin-call and close-out levels, gap and slippage treatment, negative-balance rules, and whether protections cover your product and legal entity. A stop loss is not a guaranteed exit price.
Evaluate support, disclosures, and complaints
Look for dated terms, a complete fee schedule, risk disclosures, reachable support, and a written complaints process. Confirm the regulator, ombudsman, or dispute route available to your entity. Legitimate support should not request passwords or remote device access.
Test the broker before you scale the account
A valid licence is the beginning of due diligence, not the end. The decisive test is whether the entity, platform, pricing and payment process work as described for your own account.
Before you register
Record the contracting entity, regulator, licence status, approved domain, client category and country of the account. Download the client agreement, execution policy and full fee schedule.
Demo, then a small live test
Use demo to check order types and platform stability. On a small live account, compare quoted and filled prices, commission, swap and slippage, then complete one deposit and withdrawal through the intended payment route.
Before you scale
Increase capital gradually only after statements, withdrawals and support responses match the published rules. Define your own leverage, loss and stop-out limits instead of using the maximum offered.
Red flags that override the score
- The website, payment recipient or agreement names a different entity from the regulator’s record.
- A manager requests crypto, cash or a third-party payment to fund the account.
- A withdrawal is conditioned on a new “tax”, “insurance” or deposit paid separately.
- Guaranteed returns, managed recovery or risk-free trading are promised.
- Support asks for a password, one-time code or remote control of your device.
Keep a decision record
Save the register entry, agreement, execution policy, fee schedule, account classification, statements and support correspondence. Review them whenever the broker changes its entity, terms, platform or payment instructions.
The 60-second shortlist
Before funding an account, make sure every answer below is clear, current, and documented.
- Entity name, licence status, approved domain, permissions, warnings, and account jurisdiction.
- Client-money bank, segregation rules, compensation eligibility, negative-balance policy, and insolvency terms.
- Execution policy, venue, price source, slippage data, stop treatment, and conflict disclosure.
- One realistic cost example including spread, commission, swap, conversion, and account fees.
- Required order types, trading rules, history export, outage process, and EA or API compatibility.
- Successful small round trip, realistic processing time, complete fees, and clear source-of-funds requirements.
- Maximum leverage, close-out formula, gap policy, protection limits, and your own risk per trade.
- Response quality, dated policies, complaint escalation, dispute route, and secure support practices.
The MyProfitFactor rule
Do not choose a broker from one headline number. Verify the exact entity, score all eight areas, use a demo account, then test a small live deposit and withdrawal. Keep leverage conservative and save every statement and support conversation.
Risk note
Leveraged Forex and CFD trading is high risk. Losses can happen quickly, stop orders may slip, and protections vary by product, broker entity, and country. This guide is educational and is not financial advice.
Primary sources
Use official registers and regulator guidance as the starting point. Always verify the exact company, website, permissions, and jurisdiction serving your account.