One interesting fact about the forex market is that it gathers the skill sets of various persons for its smooth running. What this implies, is that people who are knowledgeable in marketing, software development, financial analysis, and education can channel their expertise to serve the needs of the market.
For this article, however, we shall be exploring the structure of a forex partnership, the types that exist and the factors to be considered when selecting a partnership program. Read on to find out about this passive stream of income and how you can make the most out of it.
Understanding the dynamics of a forex partnership.
Generally, the term partnership signifies a collaboration between two or more persons to undertake a task or achieve a particular result.
In the context of forex, a partnership is a relationship that exists between a person called the partner and another entity called the broker. In this industry, this relationship is termed a forex broker partnership
The relationship which exists between these two persons is contractual. Hence, they are obligations and conditions that must be carried out by both parties to ensure that the terms of the agreement are mutually executed.
The partner has to refer clients otherwise known as leads to sign up with the broker. Clients are offered referred to the platform by a unique link ascribed to each broker. The implication of this is that the broker is notified when a client registers through the partner.
On the other hand, the broker has to provide promotional campaign materials like logos, flyers, and banners to aid the partner’s marketing of the brokerage platform.
It should not be forgotten that the default function of a broker is to guide traders through the uncertain world of forex by granting them access to forex resources and materials.
The answer to this frequently asked question maybe two heads are better than one. However, this answer is not sufficient. A better answer to this question is that brokers need a strong and reliable pool of active clients to sign up with them and traders need a reputable platform to trade.
Perhaps, you might be wondering why a broker needs a large client base. A large active client base is often an attestation to the broker’s quality of services and products. And this improves the rating of the broker amongst competitors.
This is where the role of a partner is needed in this triangular transaction. A partner links traders to a broker to guide them through their forex journey.
Once the referral is successful, the partner earns a commission and in some cases a fraction of the first deposit of the client.
Hence, it is safe to call a partner, the second middleman in a forex transaction. This is because a partner is an intermediary between the client and the broker. Also, do not forget that the broker is the first middleman. The reason for this is that a broker connects the client to the market.
However, it is imperative to note that seeing promotional campaigns about the quality of a broker’s service is not the only way clients sign up for a brokerage platform.
Some traders searched a list of the best forex brokers and chose the one that ranked first on the list. For some others, they made comparison charts about the options presented to them before selecting a particular one.
Regardless of the way the broker selection happened, a forex partnership is a win-win for every party involved. The broker gets new clients, the trader finds a trusted service provider and the partner receives an affiliate commission.
Different Kinds of Forex Partnership Programs
According to the modern broker system, there are two major types of forex partnership programs and they include the forex referral and affiliate program.
Amongst the forex affiliate networks, the referral partnership system consumes the least amount of effort. From its name, it can be inferred that what a partner needs to do is to refer new clients to the platform. Upon the verification of this referral by the broker, the partner earns a commission. Each partner has a personal link that shows the number of leads converted.
Often the higher the number of coverts, the higher the commission a partner earns. Some companies also offer their partners a faction of the converted client’s initial deposit.
Regardless of the partnership program, a person subscribes to it is advisable for the partner to have traded on the platform they are marketing. This shows honesty and creates an atmosphere of trust for potential converts.
Also as an added tip, partners should build an audience of people who trust in their judgment and expertise. The reason for this is that a partner’s network may not generate as many converts when compared to a community founded on unwavering trust.
This forex broker partnership program shares a similarity with the referral system in terms of operation. However, one distinguishing element is the category of people who can benefit from this program.
The people who can benefit from this program are those who have a stable income from the currency exchange market. This category of people includes financial analysts, signal providers, educational platforms, trading influencers, and a bunch of other third-party service providers.
There is also a difference in the payment type offered to both categories of partners. For the former, they earn commissions, while the latter is awarded bonuses and flat rates. For you to be an affiliate, you must have an impactful presence coupled with a strong following. Affiliates without a strong audience would find it difficult to refer a good number of converts and this would reflect in their remuneration. To increase your conversion rates, you can build a network by starting a podcast, blog, or YouTube channel, sampling forex topics.
- Introducing broker (IB)
Another way of becoming a partner with a brokerage company is to be an introducing broker. The good thing about this job role is that you do not have to invest a ton of money into getting any special license or document. With a good social media following and a community of active people, your chances of referring leads become higher which is a win-win. This is because the higher your conversion rate, the higher the amount of income you are liable to earn. An example of a broker that offers an introducing broker program is MTrading.
Residents staying in busy regions like Malaysia who desire to make a passive source of income without actively trading can benefit from a forex broker partnership. It even affords those who have a stint in marketing to channel their skills to generate traffic.
As an added tip, prospective traders should be wary of scammers who disguise themselves as partners of brokerage platforms, soliciting money to sign them up with a broker. For persons who are considering being forex partners, they should ensure that the broker they partner with is easily accessible and provides tools to simplify their advertising experience.