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Risk Management

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AMTS Solutions is a large broker software provider. One of the company’s exceptional features is its MetaTrader 5 Gateway, which allows the integration of MT5 with liquidity providers.  

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Adenasoft is a global financial solutions provider that has a substantial experience in the industry. It provides a wide range of services that are all interconnected and are easily integrated.

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Archer CTS is a group of Forex experts that provides complex trading solutions for Forex brokers. The company assists on all the levels of brokerage creation. This includes dealing with regulations, payments systems, banking solutions,…

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Atomiq Consulting is a company that provides FX broker licensing and assists companies with MT4/MT5 bridge integration. Atomiq Consulting works with different cients and helps them establish new brokerage firms. Registration in: Vanuatu, Cyprus, Matla,…

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Brokeree is an expert in assisting FX brokers in their daily operations. The company mostly focuses on providing MT4/MT5 bridge solution as well as additional services such as Brokeree’s Percent Allocation Management Module and Brokeree’s…

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Centroid is a technology and platform provider that combines analytics, automated risk management, and advanced brokerage services.

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CQG creates innovative technology solutions for the financial markets such as global market data, integrated trade routing, and technical analysis tools. CQG started developing in America in 1980. The company later expanded to Europe in…

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FXE Prime is a truly innovative company that has offices in places like Silicon Valley, Poland, and Chicago and is actively engaged in the development of financial technologies. Since its launch in 2015, FX-EDGE has…

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Risk management for Forex and Crypto Brokers


 

Before we go into the most significant risks, you should know that Forex and cryptocurrency trading risk management is the most critical factors to consider if you want to succeed in it.

We have noticed many unpleasant situations that brokerages have faced, as well as we have prevented many problems.

Risk management is the practice of identifying and analyzing loss exposures and taking steps to minimize the financial impact of the risks they pose.

 

Financial risks that you should take into consideration

Money is central in the brokerage business. In the Forex and digital asset industries, money is the end goal and the means to get to the goal. Traders and investors intrust their capital with the broker. Therefore, it is vital for the broker to know what they are doing, to fool-proof their processes, and to be up to speed with every aspect of their business. The risks follow brokers everywhere: leverage given to the clients, outdated quotes, margins, and negative balance — all of it can keep you up at night. Luckily, with the right skills and the right software, all of those problems can easily disappear.

 

Strategy and possible risks

Success is hardly ever accidental. Usually, there is a strategy behind every successful business or individual. Every company has its own idea of what its strategy is, but we can all agree that increasing profits is likely to be a top-3 for most of them. A big role in growing profits for brokers is played by traders and their motivation to go online more often and trade in larger volumes.

 

Data security: risk management and identifying problems

Cybersecurity may be a broker’s least favorite topic. In today’s digital age, however, it is impossible to ignore. It is best to learn from the mistakes of others and make sure you have the right tools in place to protect you.

Imagine the consequences of accidentally exposing clients’ confidential data. What would happen if a hacker captures their bank account records, Social Security numbers, credit card information, driver’s license details, or other sensitive data?

As you know, the damage could be substantial and prosecutable. It is a nightmare scenario no broker wants to face. Even lower-level incidents, like a hacked social media account, can be damaging in terms of eroding buyers’ and sellers’ trust and confidence.

 

How can you limit your risks?

  • Institute policies and procedures

Prevention is the best medicine. The Federal Trade Commission (FTC) encourages every brokerage to develop two comprehensive plans: one for ongoing data security and another for responding to a data breach.

  • Promote agent training

Your data security plan will be significantly more effective if you back it up with agent training and education. Start with your regular office meetings. For example, you could pick a different topic each week, focusing on specific components of your formal plan or general data security tips.

  • Instruct your clients

Consumers expect businesses to safeguard their information. Consider including a summary of your data security policies in your client folders to demonstrate the steps you routinely take to protect clients. It is an excellent way to prove that you take this topic seriously.

It is also essential to educate buyer-clients about real estate wire fraud. While lacking in sophistication, the scam remains effective in persuading buyers to wire their closing funds to a hacker’s offshore account.

 

Operational risk management

Your risk management does not stop with the analysis of strategic and technological risks. After you have worked out a plan and implemented all the latest technology, the company continues to run with its day-to-day operations. And that is another area of potential catastrophes.

 

Regulatory risk management

If we said that regulation is fun, we would be lying. Constant reports, collecting all the data, and putting it all in the right format can scare anybody.

We hope that this article has helped you to identify what kind of risks are more relevant to you and give you an idea of how you can fix them.

 

What is Finarm?

It is a comprehensive financial platform that is accessed by thousands of brokers all over the world. Finarm has no analogs now, and it is the best website both for brokers and providers. You can find products and services quickly for a cryptocurrency or Forex brokerage company, as well as provide ultimate solutions for your target audience.

The site makes collaboration between brokers and providers a simple process. It offers a listing with a wide range of providers with detailed reviews and comments from their customers. Finding a provider quickly and easily for a cryptocurrency or Forex brokerage company has been streamlined through Finarm. You will find the most suitable provider among top companies:

  • Legal help;
  • Financial service;
  • Broker setup;
  • Marketing;
  • Software solutions.

In addition to products and services, there are upcoming events in the financial and blockchain spheres, the biggest news, and helpful articles.

 

Key benefits

Here are the key advantages that Finarm can provide to your business. Take a look at them:

  • The latest information. It does the hard work for you: its objective research keeps you up to date with the latest offerings from reliable providers.
  • Less work is required. As the choice of providers grows, the amount of research required also grows. Finarm shortens the time needed to find a company relevant to your business needs.
  • A vast range of providers. Its aim is to provide complete market coverage, keep you as informed as possible, and help you with making the right decision.
  • All things are under control. Describe your business only once and exclusively to those providers that match your requirements.
  • Quick and effective. Use our searching tools and find a service in a flash.
  • Great customer support. Finarm supports its community in the best way possible. Its team is ready to help you with everything regarding the search and pick up the best offer for your business.

 

How it works

Just imagine, only three easy steps are needed to find the best provider on Finarm:

  • Select a service.
  • Customize your search. Take into consideration all the key details about your company, available budget, and needed options. So, you will be able to find a provider from a shortlist, accessible on Finarm.
  • Make a decision. Check out its review, comments from customers, and finally, contact the company. Finarm will connect you and the provider so that you will get the service needed for your business.