Emerging Issues Impacting Brokers and Account Managers When Offering Account Management Services
Transactions in the forex market occur between a pair of two varied currencies. Therefore, forex traders buy or sell certain pair they choose to trade. However, it is imperative for brokers and account managers to ensure a smooth process when it comes to executing trades, closing positions as well as managing risks of their clients’ accounts. This piece today is dedicated to addressing the emerging issues encountered by brokers and account managers while offering account management services.
Regulation
After the European Securities and Markets Authority (ESMA) introduced regulations that would increase transparency through Markets in financial instrument directive (MiFID II), they have triggered a domino impact by which regulatory systems all over Europe should comply with. Consequentially, brokers that have been using fast growing marketing and sales approaches, harnessing itself via exponentially high leverage ratios as well as excessive bonuses, can no longer enjoy these services due to the stringent regulations. With the absence of these tactics in the market, the operational parameters for account managers and brokers have become extra restrictive, especially in attracting fresh clients to their currency service. The efforts to remain a float for both brokers and account managers is, therefore, almost impossible as they endeavor to compete in a market that is full of high CPA and licensing costs.
Marketing
The domain of operation that stringent policies have targeted is sales and marketing. For instance, in some countries like Poland, a CFD broker is required to expose the functional ratios of their customers while in other nations such as Belgium, France and Holland, marketing retail forex trading is prohibited altogether. In Spain, like many authorities, all forex advertisements should be followed by a warning to the client concerning the inherent dangers of forex trading. These policies are significantly impacting brokers and account managers.
Financial Experience and Knowledge
In the forex industry, it isn’t enough for you as a broker or account manager to know that you know, you must demonstrate that you know it better. It is a requisite that brokers and account managers to have the financial experience as well as knowledge in order to facilitate efficient and safe account management service. Additionally, it shows that brokers must prove to be professional and trusted thought leaders.
Technology
For the industry to remain relevant, competitive, and compliant to the regulatory measures, brokers and account managers need to shift to modern technology. However, as it emerges, many account managers own technology that is currently limited to providing trading services. Inventive trading technology is ever transforming and need refinement, which many brokers are yet to achieve.
DNA
Brokers’ capacity to progress in the modern financial trading era needs them to understand the predisposition of trading DNA. Forex trading is no longer based on the principle of win/ lose, where the broker expects to win at the expense of the trader. Now it emerges that brokers and account managers are investment platforms guided by technology, regulations, education, and finance. Therefore, your success as an account manager or broker depends on your prowess and credibility.
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