Forex opens up a lot of opportunities and can be an excellent springboard to a prosperous life and financial independence, or it can just as easily ruin you. Beginners who want to earn good money do not know which account is better to open. Forex account types are different, they all differ in terms and conditions. Hence, rookie traders, 100% require assistance in choosing the best trading account.
Forex account types
Having decided to try trading on the stock exchange, a novice trader or investor has difficulty choosing the type of the best trading account.
Having entered the market, many people miss a number of technical features of these accounts, the knowledge of which could reduce the commission when trading, or make trading more convenient.
Consider the main types of Forex trading accounts:
- Demo account;
- Standard account;
- ECN account;
- Cent account.
Find their short feature explanation right here:
Each broker provides an opportunity to trade on a demo account and hone your skills. The difference between a practice account and a real account is that there is no risk of losing your funds since you manage virtual money.
This is a real account where you put your own real money and will risk it in real deals. Usually, the spread is fixed, but it all depends on the choice of broker, different forex brokers offer different conditions.
Such a Forex account has the next features:
- absence of slippage;
- no intermediary banks;
- direct interaction of market participants.
Any trader can see an order to sell or buy, traders have the ability to evaluate the volume of orders. Such an account is great for scalping as it is facilitated by seeing the volume of orders.
Its essence is that you can invest a minimum amount and trade without much risk. As the name implies, the amount you deposit into your account is displayed in cents. Everything that you earn or lose is also considered not in dollars, but in cents.
Choosing the best trading account: step-by-step
Psychological factors often play a crucial role, and a trader who has been playing on a practice account for a long time simply cannot switch to real money trading. That’s why you should weigh all the pros and cons as well as your own priorities to pick the best option:
- see different account reviews from practicing traders;
- decide what amount you are ready to lose;
- analyze which account features appeal to you the most;
- don’t be afraid to try several various types.
Indeed, this choice won’t impact your further trading since you can create another account type in case something doesn’t satisfy you.
Reviews about Forex are always ambiguous, but the market is something that one cannot control. When choosing your broker and account, pay attention to the ratings of companies, and reviews of their current and past clients. Choose a reliable broker that suits you personally and create an account according to the available capital and preferences.