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When you start trading the Forex, you need to make sure that you choose a broker or brokerage firm that is registered with the relevant regulatory bodies. (It is no good if you discover that your broker is unregistered, after they have stolen all your money!)

In the U.S. Forex brokers should be registered as Futures Commission Merchants (FCM) with the Commodity Futures Trading Commission (CTFC) and should be a member of the National Futures Association (NFA). You can check out the status of your prospective broker on the NFA's web site: http://nfa.futures.org/basicnet/.

In the UK, look for Forex brokers who are registered with the Financial Services Authority (FSA). Check out UK based Forex brokers on the FSA's web site: http://fsa.gov.uk/register/home.do.

You need to check that your broker provides adequate support. At a very minimum, make sure your broker offers 24 hour telephone and email support. It is a good idea, before you choose a particular broker, to contact the help lines of a number of brokerage firms. Ask them a question about their service. You need to discover how quickly they reply, and also if they answer your question to your satisfaction. This will give you a good indication of the quality of their help if you need it later. (Of course the quality of the help before you open the account, does not definitely prove that you will receive the same quality of help afterwards.)

If you intend to trade the Forex using your own computer, then you need to make sure that your broker offers online trading facilities. You also need to be able to view Forex quotes in real time. It is no good if the Forex quote displayed on your brokers site is: GBP/USD = 1.9714/1.9719, but when you open a trade, each GPB costs you $1.9740. If it turns out the displayed quote, was the exchange rate 30 minutes ago, then you need to find yourself another broker.

You also need to be able to view your account, including used and unused margins in real time.

When you place an order to trade, you must be able to buy or sell at the currently quoted price. In other words your broker must use a WYSIWYG display. (WYSIWYG is short for "What You See Is What You Get" and is pronounced wiz-ee-wig).

Your broker will offer one of two types of online access. Each of these has both advantages and disadvantages. The first type is web based software - this is hosted on your broker's web site. With web based software, you can log onto your account from any computer with Internet access, e.g. your own computer, Internet caf', office computer etc.

The second type is a client based software program running on your own computer. You can only log onto your account from your own computer. (Unless you install the software on other computers - N.B. this is usually contrary to the terms of service). The advantage of client based systems is they are usually faster than web based systems. The disadvantage (for Mac users), is the software is usually only available for Microsoft Windows systems.

It is essential that you have a fast Internet connection (i.e. DSL or broad-band). Dial-up is simply too slow, and by the time you open your Forex trade, the quote will have most probably changed form the quote on the display.

You need to find a broker that offers Mini- and/or Micro- lots. You can open accounts trading these smaller lots for just a couple hundred dollars. Some brokers offer fractional lot sizes (called odd lots), so you can create your own trading unit size. You also need to make sure your broker offers trading pairs in all seven major currencies: USD, EUR, JPY, GBP, CHF, CAD and AUD.

Look for a broker that offers the smallest bid/ask spreads. The bid/ask spread is normally 5 pips, but some brokers offer spreads of only 3 pips or even 2 pips. What is your broker's margin requirement? This may be anything from 0.25 percent to about 5 percent. Remember - smaller margins mean you need to deposit less, and give you greater leverage, but they also have the potential for greater losses.

You need to discover how your broker calculates rollover charges. Rollover charges are charged to your account when your trade extends (rolls over) past the end of the trading day into the next trading day. Rollover charges are based on the difference between the interest rate of the country of the base currency, and the interest rate of the country of the quote currency. For example, for the currency pair CHF/USD, the rollover charges are based on the difference in interest rates between Switzerland (the country of CHF) and the United States (country of USD).

And finally, do your broker's trading hours correspond with the trading hours of the international Forex?