Trading Account Suggestion

[Rambo35]

Everyone picks a trading account type based on preference, but I have seen many new traders who open the wrong account type with their broker. What I mean by this is that they open a standard account just because they are able to and I think all broker have their minimum in order to open a standard account set way too low.

I know opinions differ, but I think that you should not trade in a standard account with less then $20,000. Anything below that should be traded from a mini-account.

My suggestion has always been that new traders should start in a mini-account and trade there until they can upgrade to a standard account through trading profits they have earned and not through bigger deposits. In the end each trader needs to decide the right approach, just throwing this idea out there for new traders to consider.

 

[undertaker]

If I don't have enough $20,000. What should I do to trade forex?

 

[fxapex]

new trader should start with a minimum deposit, but should back itup with a respectable amount..........

 

[Pharaoh]

It's not necessarily the account type, it's the minimum trade volume for the account type. I've seen "standard accounts" with a minimum volume of 1 lot, 0.1 lots, and 0.01 lots.

I've seen "mini accounts" with a minimum volume of 0.1 lots, 0.01 lots and 0.001 lots. There are a few brokers that offer 0.0001 lots (pico lots - about 0.1 cents per pip).

 

[alanrox]

If I don't have enough $20,000. What should I do to trade forex?

You can start forex trading with any amount even from $5. But that's not recommended. Use Google to find out the brokers who provide mini/micro accounts


Remember to trade with money you can afford to lose

 

[Rambo35]

If I don't have enough $20,000. What should I do to trade forex?

Start trading in a mini account where 1.0 lot equals 10,000 units and grow your account from there.

 

[Rambo35]

It's not necessarily the account type, it's the minimum trade volume for the account type. I've seen "standard accounts" with a minimum volume of 1 lot, 0.1 lots, and 0.01 lots.

I've seen "mini accounts" with a minimum volume of 0.1 lots, 0.01 lots and 0.001 lots. There are a few brokers that offer 0.0001 lots (pico lots - about 0.1 cents per pip).

True, but for example 0.01 lot in a standard account and 0.01 lot in a mini-account are totally different.

 

[Pharaoh]

True, but for example 0.01 lot in a standard account and 0.01 lot in a mini-account are totally different.

That's broker display vs. reality.

A "lot" is defined as 100,000 units of currency. Most (but NOT all) mini accounts reset the definition of "lot" to 10,000 units. Some (and varies highly) micro accounts reset the definition of "lot" to 1000 units of currency.

Always check 2 things. First, what does 1.0 lot mean in your trading account? Second, what is the smallest amount you can trade in that account?

 

[Rambo35]

That's broker display vs. reality.

A "lot" is defined as 100,000 units of currency. Most (but NOT all) mini accounts reset the definition of "lot" to 10,000 units. Some (and varies highly) micro accounts reset the definition of "lot" to 1000 units of currency.

Always check 2 things. First, what does 1.0 lot mean in your trading account? Second, what is the smallest amount you can trade in that account?

I think we are talking about the same thing in different words. Yes, 1.0 lot is always 100,000 units by definition in the forex market. Brokers can change what they refer to as a lot, but most quality brokers leave the definition of 1.0 lot at 100,000 units in their standard accounts which is why they call them that. Mini-account have been created where 1.0 lot equals 10,000 units (unless the broker specifies it otherwise).

My point is that 0.01 lots in an account where 1.0 lot equals 100,000 units and 0.01 lots in an account where 1.0 lots equals 10,000 units is a big difference.

 

[Pharaoh]

Correct - which is why you need to make SURE how much that 1.0 lot in your platform is. For standard accounts, it's 100,000 units of currency (99% of the time). For mini and micro accounts, you MUST check, because not all brokers treat 1.0 as 10,000 units under these circumstances.

In the end, what it finally boils down to is "What is the smallest trade you can place?" If a standard account lets you trade 1000 units of currency and a mini account sets the minimum at 5000 or 10,000 units, then the word "mini" isn't really helping.