Asset diversity is a key factor in selecting a forex broker, as it allows traders to trade a wide range of financial instruments, not just currency pairs. A broker that offers access to diverse assets provides opportunities to hedge positions, diversify your portfolio, and capitalise on market movements across different asset classes. This guide will walk you through how to evaluate a forex broker’s asset diversity and the key features to consider.

Why Asset Diversity Matters

Trading across a variety of asset classes provides several advantages:

• Risk Management: Diversification helps reduce exposure to risk by spreading investments across different markets.
• Market Opportunities: Access to multiple asset classes allows you to capitalise on profitable trades in different sectors.
• Hedging Potential: You can hedge your forex positions using commodities, indices, or stocks to protect against adverse price movements in the forex market.
• Enhanced Profitability: Diversified trading increases the potential for profitable trades in various market conditions, reducing reliance on one type of asset.

Key Factors to Look for in a Broker’s Asset Diversity

1. Range of Forex Pairs

While forex is the primary market for many traders, a broker’s offering of currency pairs plays a central role in asset diversity. Look for:

• Major currency pairs (EUR/USD, GBP/USD, USD/JPY)
• Minor pairs (EUR/GBP, AUD/JPY, NZD/USD)
• Exotic pairs (USD/TRY, EUR/ZAR, GBP/MXN)
• Cross-currency pairs that allow trading between currencies without the US dollar as the base currency (EUR/GBP, EUR/JPY).

A broader range of forex pairs allows for increased flexibility and the ability to diversify within the forex market.

2. Commodities

Many traders seek exposure to commodities, which often have an inverse relationship with the forex market. Key commodities to look for include:

• Precious metals (gold, silver, platinum)
• Energy (oil, natural gas)
• Agricultural commodities (corn, wheat, coffee, sugar)

Access to commodities offers diversification beyond forex, especially during times of economic uncertainty or inflationary periods when commodities tend to perform well.

3. Stock Indices

Stock indices track the performance of a group of stocks and are another important asset for diversification. Key indices to consider are:

• Global indices (S&P 500, Dow Jones, NASDAQ, FTSE 100, DAX)
• Sector-specific indices (technology, energy, etc.)
• Emerging market indices

Trading stock indices allows traders to gain exposure to a basket of stocks, which can help mitigate individual stock volatility and offer broader market participation.

4. Cryptocurrencies

With the rise of digital assets, many brokers now offer cryptocurrencies as part of their asset offerings. Popular cryptocurrencies include:

• Bitcoin (BTC)
• Ethereum (ETH)
• Litecoin (LTC)
• Ripple (XRP)

Cryptocurrencies are known for their volatility, and adding them to your portfolio can provide both hedging opportunities and growth potential.

5. Stocks and ETFs

Some forex brokers also provide access to stocks and exchange-traded funds (ETFs), offering even further portfolio diversification. Look for:

• Stocks from major global companies (Apple, Google, Tesla)
• ETFs that track sectors, commodities, or even broad market indices

Stocks and ETFs offer an alternative investment avenue that is not directly correlated with forex, giving you more room for diversification.

6. Bonds and Fixed-Income Securities

Bonds and fixed-income securities offer a more conservative investment option with lower risk and regular interest payments. These may include:

• Government bonds
• Corporate bonds
• Municipal bonds

While not all forex brokers offer bonds, those that do provide traders with access to safer, income-generating assets, which balance out the higher-risk forex or crypto positions.

7. Access to Other Derivatives

Some brokers offer CFDs (Contracts for Difference) and options on a variety of asset classes, enabling traders to speculate on price movements without owning the underlying asset. These derivatives typically cover:

• Forex
• Commodities
• Indices
• Stocks and cryptocurrencies

Trading derivatives allows for increased exposure and flexibility in various markets while managing risk effectively.

Top Forex Brokers with Strong Asset Diversity

1. Intertrader – Offers a wide range of forex pairs, commodities (gold, silver, oil), indices (S&P 500, FTSE 100), and cryptocurrency CFDs, making it an ideal choice for diversified trading.
2. Markets.com – Provides a robust platform with a broad array of asset classes, including forex, commodities, indices, cryptocurrencies, stocks, and ETFs.
3. AvaTrade – Known for its diverse asset offering, including forex, commodities, indices, cryptocurrencies, stocks, ETFs, and bonds. AvaTrade offers access to multiple platforms for multi-asset trading.
4. TiBiGlobe – Offers access to forex, commodities, cryptocurrencies, and indices, with the addition of ETFs and stock CFDs, making it a strong choice for diversified traders.
5. Vantage – Features a wide range of forex pairs, commodities, and stock indices, along with access to cryptocurrency markets and trading CFDs, providing excellent portfolio diversification.

How to Evaluate a Broker’s Asset Diversity

1. Check Asset Coverage: Ensure that the broker offers access to the markets and asset classes you are interested in, including forex, commodities, stocks, cryptocurrencies, and indices.
2. Review Market Access: Look for brokers that provide access to both major and exotic markets, allowing for greater trading flexibility.
3. Examine Fees and Spreads: Compare the spreads and commissions on non-forex assets to ensure they are competitive and in line with market expectations.
4. Assess Platform Usability: Ensure that the broker’s platform is capable of handling multiple asset types, with integrated tools for managing a diversified portfolio.
5. Test the Trading Conditions: Open a demo account to evaluate trading conditions, including execution speed, liquidity, and asset availability across different classes.

Common Mistakes to Avoid

• Focusing Only on Forex: Many traders focus solely on forex pairs, but asset diversity is key for effective risk management and profit maximisation.
• Ignoring Fees and Charges: Non-forex assets, especially commodities, stocks, and cryptocurrencies, often come with higher fees. Always check the broker’s commission and spread structure for these assets.
• Overlooking Risk Management: A diversified portfolio still requires careful risk management, especially when trading across different asset classes with varying volatility.

Conclusion

Asset diversity is vital for traders looking to expand their portfolio and mitigate risk. Brokers like Intertrader, Markets.com, AvaTrade, TiBiGlobe, and Vantage provide access to a broad range of forex, commodities, cryptocurrencies, indices, stocks, and ETFs.

When evaluating a broker, ensure they offer the asset classes you want to trade, provide competitive spreads and fees, and offer a seamless platform for multi-asset trading. Testing these features with a demo account will allow you to determine if the broker meets your trading needs before committing to a live account.