Many people have a stock trading account. But since currency trading/investing is so new to the investing public, let's talk about how to open up one of these accounts and where you can do this. After all, many don't even know where to locate one of the companies and know who's trustworthy.

How to "weed out" the unregulated and the undercapitalized firms

For starters, before you "sign up" for an account at one of these firms, make sure they are regulated in a place that takes regulation seriously (United States, Canada, U.K., Hong Kong offer the best regulation).

Also, more importantly than you being "well funded" in your account, make sure they are "well funded" as a firm. Any of these firms right now should have at least 40 million dollars set aside in "excess net capital".

You don't have to take their word for itand I wouldn't. This stuff is public information and I've made it just a click away. Check out the list of market makers here:

http://www.cftc.gov/marketreports/financialdatafo rfcms/index.htm

Then just click on the most recent report which will be at the top. In this case, that's January 2008's report. Note only the market makers (which some refer to as brokers) that have $40 million dollars or over. Since you can be this picky, I would be. There are several firms that meet these requirements and then some.

Your two biggest "defenses" to your account are how tightly your firm is regulated and how well capitalized they are. Once you've resolved this, you're ready to open up an account.

These are examples of firms that meet the requirements:

www.fxcm.com
www.oanda.com
www.gftforex.com
www.rmbgroup.com

Here are the types of accounts you can have

So now that we're ready to open up an account, what the heck is required to open up one of these?

First, you'll want to decide what type of account you want to open up which will have two parts. Let's discuss the first part.

You'll want to decide whether you want an individual, joint, corporate, partnership, trust or LLC account. Of course the most common choices are individual and joint accounts. So that step is pretty easy.

The second step is to decide what type of currency you want to hold your account in and what "size" of account you want it to trade in. This will be our second selection. Let's look at our options now.

The "size" part is easy. There are two choices: mini account and standard account. 90% of people should choose the mini account

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