Forex Mini Accounts and Trading Risks
Mini forex trading accounts are an excellent option for beginner traders to get familiar with forex market. Mini accounts (contract size 10,000) are typically 10% of standard accounts (contract size 100,000), and also require low minimum deposits to open the account.
Mini forex trading accounts are excellent tools to decrease trading risks. For a mini trading account a 10 pip loss (For example: a decrease of EUR/USD from 1.5689 to 1.5679) can result in that is 1% of the trading account. For a standard trading account the same 10 pip loss can result in a loss of $100 (100,000 x 0.0010), which will be equal to 10% of a mini account. Also remember the usage of leverage can magnify this loss; and also profit if currency moves in opposite way. Many expert traders advice to keep the maximum loss per trade to below 3% of total portfolio; which can be easier to achieve by mini accounts than standard accounts.
Mini forex accounts provide more flexibility than standard accounts. Mini trades can trade fractions of standard accounts (contact sizes of 20,000, 30,000, 50,000, etc) or you can trade 10 minis to equalize a standard lot. This gives the trader to adjust his contract size according to his trading account size and also helps in effectively utilizing leverages. When trading lesser lots, mini accounts allow traders to place wide stop losses.
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Online Futures Trading, Online Forex Trading
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Mini forex trading accounts are excellent tools to decrease trading risks. For a mini trading account a 10 pip loss (For example: a decrease of EUR/USD from 1.5689 to 1.5679) can result in that is 1% of the trading account. For a standard trading account the same 10 pip loss can result in a loss of $100 (100,000 x 0.0010), which will be equal to 10% of a mini account. Also remember the usage of leverage can magnify this loss; and also profit if currency moves in opposite way. Many expert traders advice to keep the maximum loss per trade to below 3% of total portfolio; which can be easier to achieve by mini accounts than standard accounts.
Mini forex accounts provide more flexibility than standard accounts. Mini trades can trade fractions of standard accounts (contact sizes of 20,000, 30,000, 50,000, etc) or you can trade 10 minis to equalize a standard lot. This gives the trader to adjust his contract size according to his trading account size and also helps in effectively utilizing leverages. When trading lesser lots, mini accounts allow traders to place wide stop losses.
NobleTrading.com Offers Online Stock Trading, Online Options Trading
Online Futures Trading, Online Forex Trading
Worldwide Brokerage Service, Day Trading Brokerage
posted by NobleTrading at
8:54 AM
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