The education spectrum at an IB's disposal is vast; so vast that education deserves a manual all to itself. Below are some important examples of particular educational models or categories under which agents could provide value or quality to their customers.
Learn-to-Trade Seminars/Webinars – Different trading seminar providers (whether in person or virtual) typically have their own trading strategies or methodologies they like to teach, but one thing remains true: most clients are looking for something simple. They are all looking for the "5 steps to success" they need to follow and they want those steps to be in black and white.
Even though learning to trade successfully is not as easy as memorizing and following a set of simple steps like a monkey, and even though traders need to evolve in the process to become successful, IBs teaching seminars should make sure the training material and strategies clients are taught are as easy to apply as possible.
Do a pilot or usability study with a few test subjects to find potential areas of confusion in your delivery or educational materials, then make your information as simple as possible for clients to use. This is one of the keys to success under this business model because, if clients get confused in any way, they will take longer to trade and thus negatively impact your transactional revenue and bottom line. Furthermore, if clients become discouraged or frustrated because they don't fully comprehend what you are trying to teach them, they might lose interest and never trade at all. This can deal a huge blow to an introducing broker's income, especially to the ones operating under an incentive-based educational model.
Trading Rooms / Chat Rooms – Physical Trading Rooms and Internet Chat Rooms – These trading education providers should also follow the path-to-simplicity approach recommended earlier for seminars/webinars to increase the number of customers that open trading accounts. They should also take advantage of providing trade education during a live market environment. For example, trading rooms can have morning or periodic sessions where the "head trader" calls out potential trades and setups based on the methods and strategies clients are taught. They can also disseminate or provide their opinions on any economic releases or market moving developments that may occur throughout the trading day.
If these businesses have or can get experienced professional traders on staff, they can also include live trading sessions where clients see actual market transactions. Clients who are learning how to trade love watching a trader or mentor work the market live. The excitement of live trading usually equips the clients with a much-needed confidence to start trading themselves. This helps the bottom line of the referring broker.
Trading Signals or Alerts – There are many signal or trade alert providers in Forex. Disseminating timely and reliable signals to traders is a great way to add value to a client-IB relationship. The key for an Introducing Broker operating under this business model to make it work is obviously providing accurate signals. Otherwise, the clients will get discouraged and not trade.
Another important decision agents have to make is how to distribute the signals or alerts to their clientele. There are various options for this, such as email alerts, SMS (text message via phone), or other third-party applications. The method of dissemination used should depend on the frequency of the signals and the average duration of the trades associated with the alerts. For example, if an IB is planning to send out scalping type signals that are frequent in nature and have relative small take profit and stop loss levels, email won't work as a delivery medium. By the time the client receives the signal via email, the opportunity might be lost. Even SMS might not work well for very active signals, since it would take time for clients to enter the trade in their platform after the signal is received, which might take too long. Consequently, even if the signals are good, if the delivery method is not timely, customers will just get frustrated and won't trade. On the other hand, if the signals are longer-term in nature (for example, lasting a few hours or more on average), then email and SMS might still be acceptable.
Some introducing brokers who are experienced programmers or have skilled programmers on staff may opt to design their own proprietary signal delivery system or integrate it with a popular platform like MT4 (MetaTrader 4), so clients could receive the signals or alerts from within their trading platforms. With trading technology advancing every day, new methods of delivery for signal providers spring up on a constant basis, so there will always be plenty of options IBs could turn to when it's time to offer the service to their clients.
The key for the introducer who provides signals or alerts is to focus on quality (Q). That means that the signals should be professional in nature and complete with entries, profit limits, and stop loss levels. Furthermore, just as suggested under "Attractive Money Management Services" earlier, the signals should be derived with a strict focus on risk management and control instead of on unrealistically high returns. That is the key to building a loyal client base and making the FX business successful in the long-term.
MT4 EA or Automated Trading Tool Providers – "Automated trading" is a big buzz phrase in FX. Many clients want access to trading systems or robots that can actually make money on autopilot. A large number of these clients don't want to learn how to trade themselves or have already tried it and failed. Consequently, systematic traders with the ability to create good trading algorithms in a black box (or fully automatic) format for these types of customers, can have a huge edge as Forex IBs.
Of course, the key here is that the robots or trading systems actually work and have good risk management built into them. Clients have gotten burned one to many times by automated systems that allow open losses to grow indefinitely as the robot continues to book disproportionately smaller profits of a few pips here and there. This is a guaranteed recipe for disaster. If you want to provide your clients automated tools, make sure they are not just full of FAP-Turbo hype. Add some meat to those bones!
Since the MT4 platform from the company MetaQuotes has become extremely popular in the world of currency trading, we recommend that referring brokers code their systems as "EAs" or "Experts Advisors," as they are called in the MT4 programming language. IBs could then either give their clients the EA with instructions on how to install and use it, or run the EA on a server, and provide customers with a trade copier software or tool to duplicate the robot's trades in the client accounts with the proper login.
But what about if the client does not want the trades executed automatically into his or her account and instead wants to participate in the action to some degree? This is also in high demand in FX. For this type of client, the introducer could either configure the EA to alert the client of a pending or actual trade or provide him or her with a customized set of indicators or templates that trigger visual cues (like arrows, dots, etc.) on the currency chart when it's time to buy or sell. The end result would be a grey boxed (or partially automated) style tool that would satisfy the objectives of clients who do not like full automation.