Forex Mini Account

Forex Mini Accounts (or mini forex account) are usually for beginning traders looking for a way to get their feet wet in the FOREX market.

To actually trade on the full scale forex Market you need to purchase in 100,000 lot sizes which means you need a LOT of money or Margin to even thing about trading, which makes a standard trading account a 1:1 ratio account.. Obviously that's not going to happen for the majority of people out there.

That's why most trading platforms you see online are actually Mini Forex Accounts. So if you can deposit say $250 and not have a margin, it's a mini forex account.

So, how do these mini forex accounts work?

Pretty simple really. Over the last few years if you haven't payed attention hundreds even thousands of new forex "brokers" have come online.

Basically they all use the same trading platform and use the collective trades of all the customers to make trades (pooling their money to purchase lots).

So now instead of purchasing a lot of 100,000 lot minimums are 10,000 which is a 1/10th scale of the actual lot size.

On top of that FOREX mini gives you leverage by allowing you to use up to 400:1 trading ratio. That means $50 can actually buy you a lot of 20,000 (20,000 / 50 = 400)

While this sounds great you need to realize your cost to trade is increased as your leverage is. Since the cost on a forex market is in PIP's and usually the spread is 2-4 pips, when you use your 400:1 leverage you also triple your purchase cost, which can get expensive if you day trade or lose often.

Click Here To Open a Mini Forex Account

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CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.