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How To Open A Forex Account?
Unlike
the stock market, Forex trading does not happen at a physical location
nor does
it have a central exchange. Hence, a Forex trader can trade wherever
they are,
24 hours a day for 5.5 days a week! No wonder that Forex trading is so
attractive to many new investors.
To
start Forex trading, you would first need to open an online trading
account
where all your currency transactions will take place. Opening a Forex
account
involves three simple steps:
1.
Choose an appropriate
Forex trading site:
There
are two things to consider when
choosing the right Forex trading site for you. First is the
leverage the site
offers. Each site offers different leverage, which can
range from 50:1 to as
high as 250:1. A leverage factor of 50:1 for instance, would allow a
person
with USD 1,000 in his account to trade USD 50,000 in the Forex market.
While
this could allow you to make
large gains with small investments, it can also
amplify your losses if a trade moves against you. It is
important to understand
the risks involved in
determining
your intended leverage. Also, the trading site should be commission-free,
as
you do not need to go through a third party, like brokers for stocks.
Examine
the site properly before you decide to make sure they offer features
that you
need.
2. Choose an suitable account
type:
Forex
trading accounts come in
different sizes, ranging from USD
25 (micro
/ mini accounts) to USD 10,000
(standard
accounts). Choose the account size according
to the amount you want to
invest in. Choose Forex trading spot account,
which allows instantaneous trades
and is more popular, instead of a futures account.
3.
Register for a Forex
trading account:
Most
of the registration is done
online and would require your personal details as well as your credit
card
details for real cash trades. Make sure you enter your email address properly.
4.
Activate your Forex
trading account:
You
would be asked to verify your
details through several steps. Make sure you read through and
understand the
terms and conditions before you sign them online. Pay particular
attention to
the operating hours of the site, the availability of live technical
support and
any hidden commission / charges. Some sites also offer a limited-time
demo
account with no real cash involved. You can use it to familiarise
yourself with
Forex trading before you trade with real cash.
Congratulations!
You are now ready to hit the Forex market!
How
To Open A Forex Account?
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