Introducing Broker Services
Sixteenth session of Forex Training
Welcome back to Forex professional training in financial markets.
In this session we will talk about Introducing Broker, Introducing Broker services, differences between opening an account via IB and directly, Rebate and transferring an account under IB.
IB or Introducing Broker
IB or Introducing broker is a legal person who has managed to apply for a branch from a broker, and can work as a broker’s representative.
It is not easy to be a reliable IB and there are many terms and conditions.
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IB Conditions
Having a website is one of the requirements.
Using a website, an IB can offer all necessary information to their clients, which includes complete details about how to open an account, depositing and withdrawing funds, and reliable sources where clients can access an educational training.
If you look at our website, you can see a considerable amount of information about Forex, Forex School, opening an account, Forex strategies, downloadable platforms and analysis, as well as other sections which may be required by a client.
There is also a complete information about brokers, their commission, their spread or regulators, for example.
Usually, a reliable IB has more than 50 clients, and they can direct them at all times.
With the access to a complete information about the brokerage, IB can compare them and offer the best one to a client according to their needs.
A good IB has a comprehensive knowledge about financial markets, such as different analyses and methods, plus profound knowledge about brokers.
IB services
There are many different services that a reliable IB can offer:
They can give advice on opening an account, and how to sign up for a demo or a real account, and necessary documentation for trading account. IBs can help their clients with more convenient payment methods.
Rebate, which will be discussed in more detail in future.
They offer analysis to their clients, either daily or weekly, that is available on their website.
They can offer customer services and counselling to their clients at any time.
They solve any possible issues that a client faces. They will also help their clients to improve their trading knowledge.
They can offer educational packages to their clients.
They offer all brokers related updates, news, promotions, bonuses, etc. to their clients. They can transfer different amounts between brokers.
It is possible that a party has different accounts with different brokers, therefore an IB must be able help a client move their money from broker to broker.
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Regulated IB
In some countries, such as the United States and Singapore, an individual who is interested in applying for an IB must pass an exam to receive a special IB qualification.
This is because IB is a very delicate and important subject and everyone must study and pass this exam in order to introduce clients to brokers.
Many people would like to know if there are any differences between opening an account using an IB and opening an account directly.
You should know that a spread and commission are the same whether you are introduced by an IB or you open your accounts directly.
Many brokers actually prefer their clients to open an account via IB, hence their IB can support their clients throughout.
In fact, an IB is a bridge between a broker and a client.
Sub IB, which means a bigger IB, can work with smaller ones and in this way smaller IBs can use the services that the bigger IB offers.
IB’s Commission
Every IB receives a commission for every client introduced to the broker, and this commission is for the trades that a client makes, not for the amount that they initially deposit.
This commission has two types:
Fixed Commission
Trading on different symbols in various conditions and amounts, provide fixed and equal amount of commission.
Any trade that a client makes, broker will pay fixed commission to the IB, such as FIBO.
Percentage Commission
Percentage commission means that a percentage of the spread on a traded symbol will be paid as the commission.
This means that the commissions are different from one asset and symbol to the next. For example, Exness offers 33% of the spreads on symbols.
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Rebate
This is one of the services that we offer to our clients. A proportion of the commission that is usually paid by a broker to an IB, will be given to the client.
We usually pay a percentage of this commission to the client. The time that a broker pays the rebate may be different from other brokers.
Some choose the first day of each month and some use automatic pay on a daily basis, however, there is a limited number of brokers with this policy.
For example, in FOREX4YOU, 2 hours after you finished your trades the commission is paid automatically.
Again, on our website a trader under the FOREX4YOU category can receive rebates 2 hours after his trades every day.
There are also traders who would like to change their account to an IB account, these traders are split into two groups.
In the first group are traders who opened their accounts directly with a broker; and in the second group are traders who have accounts with different IBs that can be transferred.
Transferring an Account
There are different ways that you can transfer your account in brokers.
Trader can open a new account by going to brokers’ websites such as EXNESS to apply for a new account.
Some brokers, such as Alpari, require a client to close their old account by sending an email to the broker, before opening a new one.
A client can send an email to their broker asking to transfer their account under an IB account.
If you would like to know more on how to transfer your account, you can visit our website and go to the transferring accounts section.
You will see all the information about transferring accounts for different broker.
You can also go to Forex rebate section on our website and see the rebate amounts of different brokers.
That concludes this session, until next time and another session take care.