please everyone who is new to forex...do yourself a favor and don't open with any firm that will allow a deposit of 5$...lol. they are not true ECN. Almost all true ECN brokers will charge you a commission.
Based on your questions, I would say that you need to spend some time doing good homework before selecting your intermediary. There is a vast shark pool out there that you need to circumnavigate on your way to finding the best broker for you. - Are you planning on using your own residential address for the account? - Do you intend on using a separate business entity for the account? - What are the tax rules where you plant to set-up the account? - Is this just a hobby or will you run your trading like a business? Will you initiate your account between: A) $2k - $15k? B) $15k - $100k? C) $100k - $300k? D) $300k - $1mln? E) $1mln and up? What kind of experience do you have: A) Beginner? B) Novice? Note: I did not list Experienced, Expert and Professional, because had you fallen into either of those three categories, you would not be asking these types of questions. There are plenty of people out there who have 'A' and 'B' level experience with 'C', 'D' and 'E' level initial capital. If this is you, then you need to do a LOT of homework to make sure you don't get eaten by the sharks on the supply side of the forex business. In either case, I would suggest doing lots of homework online on brokers in general. Develop an understanding of what DMA (Direct Market Access) and STP (Straight Through Processing) really mean. Study some of the back-end technology that makes it possible. You need to develop an understanding of the Buy-Side, Sell-Side and Platform (Service) Side of the STP model (especially in forex). You need to understand what a Proprietary Liquidity Pool means within the context of an Over-The-Counter Market model and how your broker or intermediary configures such a model to produce the market in which you trade. If your initial account size is 'D' and above, then I would NOT start there as your level of experience is not yet ready for that level of engagement. 'D' and above accounts should really be done through a Prime Broker relationship - so that means doing the homework and learning what a PB is all about, how to work with them and what kind of "services" you can expect from such an account/source. There is a LOT to talk about on this subject but some of the things that you need to avoid are brokers who are notorious for the following: - Persistent negative slippage. - Persistent re-quotes. - Persistent manipulation of spreads before significant market moves. - Persistent frozen platforms before significant market moves. - Persistent bid or ask spikes not seen on other platforms. I would not still be in this business if it were not exceedingly profitable. However, there is a natural learning curve. There are no shortcuts through the learning curve, but you can learn some valuable lessons from traders that have already taken the journey and spent years honing their skill. This is not a be-all end-all list of things to learn. This is a Starter Package of lessons that you need to get under your belt ASAP. You still have to learn how to trade the Forex. You need to figure out what type of Forex trader you want or need to be (fundamental, technical or hybrid). You need to get an understanding of the speed with which the Forex markets can move (lightening quick at times). You need to learn how to properly use Leverage and Lot Size to optimize the goals you have for profitability. You need to develop a reasonable level of Expectation with respect to profitability in the Forex market. Trading the Forex with longevity, consistency, accuracy and predictability is a huge subject. If you are willing to invest the time and energy into your education, then you can become successful in this business. But, if you believe that somehow you can simply walk into this business with all the sharks in the water and take the market by storm, then that dog probably won't hunt in the long run. We have not even talked about Trader Psychology and how it applies to you personally. There is indeed a lot to learn, if you want to be more than a Gambler in Forex. Traders are not Gamblers. Traders are not Guessers. Traders are Engineers who design methodologies to extract profits predicated on the historical and empirical evidence for a detectable range of expected price behavior. As a Trader you are part Scientist, Artist, Psychologist, Engineer, Logician, Statistician, Theoretical Mathematician, Money Manager and Economic Analyst. Anyone can point and click a mouse. Few can actually engage the art and science of Trading and do it exceedingly well.
I think Pepperstone would be worth a look from Australian brokers. Fast execution, small spread... etc.
I'm going to suggest a vastly different method for a novice to use and I'm not suggesting FrostyTrader's method is wrong it just comes from a different mindset. My guess is there are very few viable alternatives in Forex. As you are doing find out who the best two or three are from experienced traders who have been using them for some time. Choose one, open up with a small amount of money -- certainly less than $5,000 and maybe even $2,000 -- and let this entire process take up less than one hour of your time -- FOR NOW!! You have a lot to learn and this, while important, should not be a fine tuned or nuanced decision. Take advice from guys who have been there to avoid being defrauded and double back after three months of trading and learn more about brokers. Now ... you need to learn to trade. This is good advice you have already received here at ET: I would look at Australian brokers. They are hard regulated.