Explore the different kinds of Forex trading accounts
Various types of Forex trading accounts are available for the retail Forex traders.
- Mini accounts,
- Standard account and
- Managed accounts
are the most common types of Forex accounts. Most of the Forex brokers offer demo account to introduce traders to the software and the methods used by them. After practicing on the demo accounts with different dealers, a trader can open a funded traded account by putting real money in it. A trader can choose any one out of mini account, full account and managed account according to his/her requirement and the capital which he/she can put in the trading account.
Mini accounts are similar to the standard trading account; the only difference is in the lot size. The currency traded in mini account is in lots of 10, 000 rather than 100, 000. This allows traders to start trading with a low initial investment and to greater customization of risk management. The most important thing which a trader should keep in mind before opening an account is that what he/she wants to get out of the trading account. Demo accounts and mini accounts are sufficient for the small traders to learn a trading system and the execution methods of the broker. For those traders who do not want to trade by themselves, a managed account is a better option.
Forex managed trading is a trading managed by a money manager on behalf of a customer and he/she charges money from the client for his/her services. These currency exchange accounts are similar to the equity accounts which are managed by hiring an investment advisor. Fees and returns of the managed Forex account varies therefore do a good research before handing over your account to a professional manager.
Some of the managed Forex accounts involve the teaching of the traders by the manager. They teach the traders about the signals to look for and to interpret them. Some of the managers of the managed Forex accounts use the currency trading system of their own firm. It is important to note that no trading system is a perfect money maker because if it is so then seller will not want to share it.
Most of the reputed Forex brokers provide you the flexibility to choose any one out of three different trading account types. Each Forex account provides you the full access to the online trading platform including unlimited technical indicators and charts, mobile trading software, automated trading and access to detailed account information. Strategic outlook and regular intra-day market updates on the main currency pairs are delivered by the brokers free of charge.
Some of the brokers also offer micro Forex trading account for new traders. They allow trading without any initial deposit under their supervision without exposing them to risk. Standard accounts are suitable for professional and experienced traders with a perfect knowledge of the Forex market with minimum initial deposit of $10, 000. Executive trading accounts are appropriate for those traders who can trade large volumes and the minimum deposit for such accounts is $100,000.
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