Find right derivatives broker

Research and compare different pros to ensure they meet your needs.

- Maboko Seabi

Choosing the right derivatives broker is a crucial step for any beginner investor, as the broker you select will be your gateway to the financial markets.

A broker's platform, fees and range of services can significantly impact your overall investment experience, performance and long-term success.

This comprehensive guide will help you identify the key factors to consider and the red flags to watch out for whether you are choosing your first broker or searching for an alternative one.

1. Regulation and reputation

Your first consideration should be the broker's regulatory status and reputation. Regulation ensures that the broker adheres to established financial rules and operates fairly and transparently.

In South Africa, brokers should be regulated by the Financial Sector Conduct Authority.

A solid reputation, backed by favourable customer feedback and an established presence in the industry shows reliability.

Watch out for brokers not regulated by any credible authority or with a history of customer complaints or legal issues. Unregulated or poorly regulated brokers pose significant risks, including fraud or unethical practices.

2. Fee structure: commissions and other costs