Broker

An individual or company that acts as an intermediary, putting together buyers and sellers for a fee or commission. A Broker is a 'middle man' (sometimes a bank) acting as a 'negotiator' for both customer (the trader) and supplier (the main market players like commercial or national banks and financial institutions. Bearing in mind that forex lots are typically $100,000 small investors need brokers to manage their online trades and trading account. Where trades are small or happen quickly, certain brokers handle the buying and selling 'in house'. This is more likely to be the case with 'mini' or 'demo' accounts. Although price changes are claimed to be the same as 'the market' it is possible that some brokers may delay or otherwise manipulate prices using their proprietary software to end a trade when it may be more advantageous to themselves than their customers. Choosing a reputable bank or broker is an important aspect of successful forex trading.