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Best NZD/USD Forex Brokers

The NZD/USD pair showcases how many US dollars it takes to buy one New Zealand dollar. It is a commodity pair, seeing as the NZD and the New Zealand economy, in general, are heavily influenced by agricultural factors. Whole milk powder is one of the largest exports of the country, which means that its value will increase when dairy prices are on the rise globally. When diary prices are down, however, trading the Kiwi also becomes less appealing.

The NZD/USD pair is available at the majority of online brokerages, giving investors who prefer this pair an ample number of websites to choose from.

How NZD/USD Trading Works for Traders and Brokers

USD/CHF TradingA forex pair consists of two types of currencies. The first one, which here is the New Zealand dollar, is called the base currency. The other is referred to as the quoted currency, and here, that would be the American dollar. Investors make use of lots in order to decide how many units they should trade, and a standard lot consists of 100,000 units.

The NZD/USD is also popular among carry trade enthusiasts. A carry trade can be done when one of the currencies in the pair you focus on has an interest rate higher than the interest rate of the other currency. The investor can then use the low-interest currency to convert into the other. If you hold this trade and the price remains the same, you make a profit off of the interest rate differential. Carry trading can be very risky, especially when high volatility is involved and in times of economic turmoil in general. Therefore, caution is advised for anyone contemplating this trading strategy.

Another thing NZD/USD investors should be careful with is leverage. Leverage involves borrowing money from a broker in order to invest more than what you can pay at that time. Using leverage successfully can greatly magnify the amount of money you can make off of a trade, but in the same breath, it can make your losses far more devastating.

Top NZD/USD Trading Brokers

choosing a brokerStarting to trade in the FX market can be an arduous endeavour. There is a seemingly endless amount of information to sift through and learn, and the process is not made easier once the time comes for you to choose your broker.

The past few decades saw a boom in retail forex investments, as the internet provided ample opportunity for brokers to offer their services online and thus make FX trading accessible to retail traders. The sheer number of brokers on the web can be overwhelming, and the spread limit, the commission, the broker’s regulators, and more, are all aspects one should consider before settling on a broker. In order to assist you with this process, we have gathered some of the best NZD/USD brokers below.

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FAQ

1. What is an inactivity fee?

This is a fee that will be deducted from the balance of an investor if they have been inactive for a long period of time. There are brokers that have started to phase out this practice, but it is still used by some. In addition, most brokers will only charge the fee up until a user’s broker account is out of money, at which point they will close the account instead of letting it accumulate negative balance.

2. Why is the NZD/USD instrument known as the Kiwi?

The name comes from the New Zealand Dollar. On the back of the one New Zealand dollar coin, you will find a rendition of a Kiwi, the country’s national bird. When you trade the NZD, you are therefore trading the Kiwi.

3. What is negative balance protection?

Negative balance protection, as implied, prevents your account balance from going negative. If this failsafe is not implemented, you can lose more money than you have in your account, in which case you become indebted to the broker. Broker regulators have negative balance protection as a requirement nowadays.

4. Is my money in danger if my broker becomes insolvent?

So long as you are trading at a reputable broker, no. Brokers who are regulated by esteemed regulatory bodies keep your funds in segregated accounts at trusted banks, away from company money. Therefore, they would not be demanded to use your money in the event that they cannot pay their debts.

5. How can I fund my forex account?

There are numerous banking solutions you can use to deposit into your account. In general, specific methods’ availability depends on your broker. Most brokerages accept credit and debit cards, as well as bank transfers. In addition, e-wallets are also popular, especially ones like Skrill, PayPal, and Neteller.