Free Forex Signals - Any Good?
There comes a certain level of doubt with aything that's free, especially when it comes to financial advice. We take a look at the pros and cons of free forex signals providers.
Free Forex Signals From Forex Brokers
Many forex brokers provide free signals to their clients. They offer this to try and generate new customers, as most people new to forex trading would gladly accept signals provided to them by a professional analyst as opposed to working out good trades on their own.
Are the signals provided by brokers trustworthy? You would have to assume so, given that they are putting their on reputation on the line. If the broker simply passes all trades to the open market and makes profit by charging commissions per trade, it would be in the broker's best interests to have winning forex signals which attract as many clients as possible. More traders equals more profit for them.
In fact, all forex brokers stand to benefit from providing forex signals with a winning return because the more clients they have, the more opportunities to make money. We have no reason to doubt that any broker providing free signals is not doing so with genuine intentions.
Free Forex Signals By Signal Providers
There are hundreds of forex signal proiders online, but some are paid services whilst others are free. Why the different business models? We can see that there are a few different ways that a free signals provider could potentially make money.
Affiliate commission model - Here the signal provider is paid commissions by the broker who they recommend. The signal provider advertises or recommends a specific broker and hope that the users sign up and trade with them.
Free with a premium service model - Here the signal provider offers additional services for a paid fee. This may include services such as more signals, faster delivery, invitations to a managed account.
Conversion to paid model - Here the signal provider gathers a lot of users over time, then decides to convert to a paid subscription model. Since they have "proofed" their service by offering signals for free, they have enough supporters and followers who would want to continue receiving the signals and would gladly pay to do so.
Read through our reviews of the top forex signal providers.