WikiFX report: 4 Steps to Becoming an Introducing Broker

Becoming an Introducing Broker can be the easiest method to increase your income, process, and explain all the benefits of being a CWG Markets Client. New forex brokers have different ways to enter and offer forex trading services in one of the most fascinating and lucrative markets in the world. One way to do so is by becoming an introducing broker (IB).

Similar to affiliate marketer, introducing brokers operates in collaboration with another brokerage firm that already has a client base and a successful profitable operation. However, an IB broker is much more than an affiliate marketer. Its a real partnership between two firms where the IB broker is able to offer additional services and even make higher commissions.

Hence, when you're able to attract forex clients and also provide forex trading services, becoming an introducing broker could be the ideal solution for you. With the steps we have outlined in this article, you can start an IB business. But firstly, lets understand what an IB Introducing Broker is…

What is an Introducing Broker (IB)？

An introducing broker (IB) is an individual or organization that solicits or accepts orders to buy or sell futures contracts, commodity options, retail off-exchange forex contracts, or swaps but does not accept money or other assets from customers to support these orders.

Registration is required for an IB unless the individual or organization is:

• Registered as and acting in the capacity of an AP;

• Registered as an FCM;

• Registered as a CPO and only operates pools;

• Registered as a CTA and either solely manages accounts under powers of attorney or doesn't receive per-trade compensation; or

• Is a non-U.S. resident or firm with only non-U.S. customers and the firm submits all trades for clearing to an FCM.

All registered IBs must be NFA Members.

An IB, on the other hand, not only brings in clients but also provides trading services and consultation. An IB can create long-term relationships with clients that are based on the quality of their services and the professionalism they offer. Secondly, an IB doesn‘t accept and hold clients’ funds. Lastly, an IB does not need to have a compliance department and proceed with KYC procedures with clients.

How to Become an Introducing Broker (IB)？

When you're surprised on how to become an introducing broker, Below are some steps for You to consider

1. You need to Find the Right Brokerage Firm to Partner with

Finding a righteous broker which you want partner with is the first and most essential thing to consider. We know There are lots of forex and CFD brokers to choose from so this step might be the most important of all. In some cases, you might have to open a trading account with the prospective partner broker and find clients reviews about the firm.

Additionally, you should consider the following aspects before you sign up with a partner broker:

• Is the broker licensed and regulated？

• What financial assets do they offer？ Forex, CFDs, options, stocks？

• How long do they operate in the forex trading industry？

• Whats their reputation？

• Do they have good trading platforms and mobile trading apps？

• Whats their commission structure for IB？

• Do they offer marketing assistance？

As we highlighted above, finding a regulated brokerage firm to partner with is not an easy task. The forex industry is filled with unregulated brokers and occasionally, even scam brokers. As such, you need to ensure that clients get safe trades and are able to withdraw funds whenever they wish. Partnering with a regulated and reputable broker is essential for your success as an IB.

One more vital thing is, you need to sell your clients a top-notch trading experience and preferably, low trading costs. So, an advanced trading platform and a mobile trading app will help you attract more clients. Additionally, a wide range of financial instruments would be another crucial factor. Make sure you choose a partner broker that gives your clients access to shares, ETFs, Forex, commodities, indices, and cryptocurrencies.

2. Close the Partnership Deal with the Partner Broker

As you have decided on which broker to partner with, its time to check out what they are actually offering you. Look at the execution model they have – ECN/STP or market maker, check their commission per trade, and understand all the terms and conditions they have for IB.

Try to also find out whether the rates they offer match your clients style. If you can bring heavy traders with a large sum of money to trade with, you might have to choose forex brokers with VIP accounts, and special terms for those who trade with large account balances. Ask your partner broker how flexible they are with the commission types they offer and do they have special packages for the type of clients you plan to refer. Further, will they provide special trading tools for IBs？ Do they offer a demo account？ Islamic account？

The moment you got the answers and you are sure you made the right choice – close the deal.

3. Find Clients and Refer them to the Partner Broker

After closing a deal with your desired broker for partnership, then its time to find clients and refer them to your partner broker. After all, this is how you can make an income from becoming an IB.

You can do so by creating a website and other social media channels and pages or use your existing contacts, if you have any of these. Try to differentiate yourself with the unique service and trading tools you provide your clients. Most importantly, be attentive to your clients needs and help them find a way to get reliable access to the market.

By the time your clients believed that you have the tools to provide them top-notch access to the trading world, youll be able to develop a long-term relationship and increase your client base. This will benefit you as an IB as well as the brokerage partner you are promoting.

4. Build on Your Success

Finaly, you need to create a successful business. One way to do that is to develop an online presence by building a website, social media pages, newsletter, etc. Obviously, youll have to create a unique name for your business, whether you decide to use your personal name or a professional brokerage firm name.

Something you need to remember – in the world of online trading, reputation is everything. A successful introducing broker usually has the most satisfied customers. So, make sure your clients are satisfied with the trading experience you provide them and do everything possible to transfer that information forward. This can be done via reviews, forums, a YouTube channel, trading tutorials, etc.

Becoming an Introducing Broker (IB) – Things to Keep in Mind

We have now provided you with the necessary information on how to become an introducing broker, here are some additional key points to keep in mind.

You must need a clients, then you should find them immediately, also you need to find a Better business model and lastly ensure to make your partner broker satisfied.