An Introducing Broker refers clients to a forex or CFD broker in exchange for a commission or rebate on the referred clients' trading activity, without handling the clients' funds or executing trades directly — the underlying broker does that. IBs range from large regulated financial firms to individual affiliates running a website or community.
Because IB compensation is often volume-based, it's worth being aware that an IB's recommendation can be commercially motivated, which is one reason to independently verify a broker's regulation rather than relying solely on an IB's claims.
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How a Broker Holds Your Money
Segregated accounts, regulatory capital and compensation schemes are three different protections that get described in one sentence. What each covers, what it does not, and how to check which apply to you.