The role of the broker has commonly been found in equities, commodities, derivatives and even insurance and real estate markets since the beginning of the modern era. And until the dawn of the internet age, most brokers operated by phone. Clients could phone in their orders of trades, and brokers would buy and sell assets on behalf of their client’s accounts for a percentage-based commission.
With an internet connection and a computer or mobile phone, traders can now open an account and trade in a market that was previously only accessible to banks, large companies and financial institutions, and very wealthy individuals. Brokers also offer services that can be valuable in assisting traders to understand price movements and potentially make profits.
A forex broker, also known as a retail forex broker, or currency trading broker, in modern financial and commercial trading means an intermediary who buys and sells a particular asset or assets for a commission. Thus, a broker may be thought of as a salesman of financial assets. The origin of the term is unclear, though it is thought to stem from old French.
Retail forex is forex that is traded through dealers, often by smaller or individual investors. These firms are also known by the term “retail aggregators.” Retail forex trading began to become popularised in the late 1990s with the emergence of internet-based financial trading. At that time, retail forex brokers and dealers went into business to allow smaller traders to get into markets that were previously limited to large-scale businesses and financial institutions.2)