On the other hand, it doesn’t mean that you should. There are lots of risks attached to the low-capital accounts, and they require a lot more skill to remain profitable. So let’s review the various Forex account types and see what proportion you actually need to spend to start out using all.
You should never put into one trade quite 1% of your starting capital.
Cent Account
Cent accounts are made specifically for the traders with the low starting capitals. They “multiply” all investments by 100 and divide all the payouts by the same amount. At first glance, it seems like a gimmick, but that gimmick allows you to trade more freely and better calculate your strategy.
The Cent accounts are the most cost effective among all the real-money accounts. They are also the sole ones that allow you to trade without leverage from 100 USD — which becomes 10 000 USD, or the worth of an entire Forex lot, as far because the trading terminal cares.
Of course, the profits will be rather small too. And not only thanks to the dimensions of your trading capital but also due to the larger spreads on the Cent accounts. So, while it's technically possible to enter the Cent accounts with 10-20 USD, the simplest entry point would be around 100 USD.
Spread is that the difference between the buying and therefore the selling prices: the tighter the spreads, the more profit the Forex trader can make.
Practice Demo Account
It’s obvious that nobody likes loosing money. But what about those who are willing to try Forex trading as a side job, or an additional way to make money part-time. In addition to lack of experience, there also are lack knowledge of trading platform, as an example, like MetaTrader 4.
The solution is invented already. Forex brokers have Demo accounts for beginners, where it's become real to trade with no investment. It’s a kind of a simulation with real conditions, existed markets, currencies, and real-time changes in the currency rates only with virtual money on it. Anyone can easily open practice Demo account simply by entering your email address, for instance, here.
Standard Account
Standard accounts are what they sound like. They provide the quality conditions for the traders and offer some advantages compared to the Cent accounts. The largest one is the tighter spreads — while the lowest spread on the Cent account is 0.3, the Standard accounts go down to 0.1 spreads on the major currency pairs.
While this might not seem much, consider that the most profitable trading strategy — scalping — requires you to close orders with only 0.5 pips of profit. Switching from the Cent account to the Standard account reduces the losses from 60% to 10% and allows scalpers to make twice as much profit.
On the downside, Standard accounts require larger investments. There is no multiplication, so you will need larger orders. The minimum deposit is 100 USD, but profitable trading with such low amounts are going to be rather hard. If that’s all you can afford to invest — you’d feel much better on a Cent account. For Standard, you ought to have a minimum of 500 USD.
ECN Zero
ECN Zero is a special case — these accounts are created specifically for the scalpers and have 0 pips spreads. On the other hand, they carry a significant fee for each transaction and have a 500 USD minimum deposit.
ECN Zero accounts are meant for professional traders and aren’t recommended for the newcomers — even though they are more suitable for scalping, the risks and expenses are way too high. However, if your average order is 1000 USD or more, ECN Zero will provide you with better profit margins than the other account type.
Conclusion
It doesn’t actually matter what proportion money you've got — you'll start trading on Forex. And the best place to start is Just Forex. Broker offers all account types, reliable analytics, and frie
Hello Trader, My name is Ankush. On the blog "AM Trading Tips" contains Indicators and Trading Systems for Forex and Binary options. With a variety of trading (Forex and Binary indicators,trading strategies for different trading styles,and also Expert Advisors) that can be absolutely free
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