How to choose a broker: a step-by-step checklist (2026)

1. Define the market and the product

FX majors, EU or US shares, stock indices or crypto spot and CFDs need different licences, platforms and risk controls. Start from the asset, not the bonus. Then decide the product: buying shares or coins outright, trading CFDs or spread bets on the price, or futures. CFDs are leveraged and, for retail clients in the UK, the EU and Australia, carry leverage caps such as 30:1 on major currency pairs and 5:1 on individual shares. They are not available to retail clients in the US, where retail forex goes through CFTC-registered, NFA-member dealers (see our US forex rules guide).

2. Verify regulation on the regulator's register

Note the legal entity name and licence number from the broker's website footer or client agreement, then check it on the regulator's own register. Marketing sites and app stores are not proof of a licence. Official registers include:

• UK — the FCA Financial Services Register, plus the FCA Warning List of unauthorised firms.
• EU — the national regulator's register, for example CySEC's list of Cypriot investment firms and its list of approved website domains. For crypto providers, the ESMA register of MiCA-authorised crypto-asset service providers.
• Australia — ASIC's professional registers (search for the Australian financial services licensee).
• US — NFA BASIC for forex dealers and futures firms.

Watch for clone firms. The FCA warns that scammers copy the name, address and licence number of genuine firms, so contact a broker only through the website, email and phone number shown on the register, not the details in an advert or unsolicited message. A firm missing from a warning list is not proof that it is legitimate.

3. Cost the real spread and every other fee

Add spread + commission + overnight fees. Then run a tiny live trade to see fill quality before committing size. A fair comparison prices the same trade at each broker:

• Spread — the gap between buy and sell prices. On EUR/USD, a 1.0-pip spread costs about 10 US dollars per standard lot of 100,000 euros.
• Commission — per lot, per share or as a percentage of the trade. Raw-spread accounts trade a smaller spread for a commission.
• Overnight financing — leveraged positions held past the daily cut-off pay (or occasionally earn) a financing charge.
• Currency conversion — trading a US index such as the S&P 500 from a euro or pound account can add a conversion fee on every trade or on profits and losses.
• Account fees — inactivity, withdrawal, market data and platform fees, listed in the broker's fee schedule.

4. Test money movement before you scale up

Deposit and withdraw a small amount. Slow or blocked withdrawals are a red flag. Check which payment methods are accepted, whether withdrawals must go back to the card or bank account you paid from, and how long they take. Ask how client money is held: regulated brokers usually keep it in accounts separate from their own, and compensation schemes may apply if the firm fails. In the UK, the FSCS can pay up to 85,000 pounds per eligible person, per firm, for investment firms that failed after 1 April 2019; in the EU, national schemes must cover at least 20,000 euros per investor. Neither covers trading losses.

5. Match the platform and tools to your process

OpenBook trade ideas are educational, not instructions to trade. Choose a broker for your own process and needs (order types, guaranteed stop-losses, mobile app, API access, charting), and check it accepts clients from your country. Many traders chart on a separate platform: our TradingView free vs paid guide explains what the free plan covers. Open a demo account first and practise placing, changing and closing orders. Process first, platform second.

Red flags when choosing a broker

• You cannot find the legal entity, or it does not appear on the register of the regulator it names.
• Deposit bonuses or leverage far above 30:1 on major currency pairs. UK, EU and Australian rules ban trading inducements and cap leverage for retail CFD clients, so these offers usually come from an entity outside those rules.
• Unsolicited calls or messages, pressure to deposit quickly, or an “account manager” who tells you what to trade.
• Promises of guaranteed or unusually high returns.
• Withdrawals that are delayed, refused or made conditional on paying a new “fee” or “tax”.

Broker checklist: what to confirm before you open an account

1. Market and product chosen — for example spot shares, forex CFDs or spot crypto.
2. Legal entity and licence number noted — the one that applies to residents of your country.
3. Register checked — status current, permissions match the product, contact details match the website.
4. Warning lists checked — for example the FCA Warning List.
5. All-in cost calculated — for a trade size and holding period you would actually use.
6. Leverage and margin rules read — including when positions are closed automatically.
7. Small deposit and withdrawal tested — with times and fees noted.
8. Documents saved — client agreement, fee schedule and risk warning.

Ready to compare? Use the market-specific guides: forex brokers compared, crypto brokers and exchanges compared, or, for US residents, crypto exchanges in the USA. Considering a funded account instead of your own money? Read prop firms for beginners first.