Szeri Nos Biggs Trading |Types Of Foreign Currency Trading Accounts
If you are a beginner in the world of Forex trading, you may be a bit overwhelmed by the seemingly endless number of new terms and tools you think you must learn. Knowing and understanding the risks involved, understanding candle chart patterns, deciphering relevant news are overwhelming when you first begin. But the journey to Pro Trader Town is successful not by how quickly but how completely your route allows you to reach you destination. In a recent article we discussed critical elements to consider. Today we discuss the selection of a broker and the account you will trade
You need to choose a broker. 
This decision is important as any you make. It involves choosing a specific trading account. The account type choosen depends on a range of factors such as the amount you have for investment, whether you will be trading on a full or part-time basis and your tolerance risk.
Consider these important issues:
Use the following guidelines to avoid choosing the wrong broker.
Be very cautious if you are considering opening an account with a new broker. New brokers are not necessarily bad , but many new ones are just around for a few months, then they disappear (some of them with your capital).
Brokers that offer $$$ or other bonuses (such as iPads, etc) when opening your account should be avoided.
Not all brokers offering incentives “ are bad brokers, but we know that few things in life are FREE.
Consider only regulated brokers . Regulators are good for traders, they help you in case your broker acts against you, so you better open your account with a regulated broker. But lets be truthful here FOREX is still the wild west so the caveat is trade only with risk capital.
Ok, these are a few of the most important aspects that you should avoid at all costs. Now lets talk about a few things that you need to consider to open your account.
Mini Trading Account
A mini account allows you to make trades with smaller lots. Most mini lots are equal to $10,000 whereas a standard account is normally 10 times the size. Most brokers offer both standard and mini accounts. The mini account is an added attraction to their brokerage for beginners in the market and those who are not willing to trade in full lots due to the costs involved.
Advantages of a Mini Account
• The low risk attached to this type of account is its main advantage. By limiting trades it is possible for new traders to commence trading without using all their funding. This gives them the opportunity to test various strategies without the worry of losing all their money.
• The low initial investment is an attraction as you only require about $500 to open an account and some of the brokerages offer leverage of up to 400 to 1.
• Efficient risk management is imperative in this financial market and this is simple to do with this type of account. If you consider one standard size lot to be too risky for your taste, it is possible for you to buy a few mini lots, thus reducing your risk considerably.
Disadvantages of a Mini Account
• The rewards are lower than in a standard account. If you trade $10,000 your gain for every pip is $1 compared to $10 if you were using a standard account. However, the risks are lower.
Standard Trading Account
This is the most common of the accounts available. You will have access to lots that are worth $100,000 each. This does not mean that you are required to invest that amount of money as the rules related to leverage and margin gives you the option to trade with an amount as low as $1,000.
Advantages of a Standard Account
• Most brokers offer better services and more perks for traders with these accounts, mainly because of the higher initial investment.
• The gains are higher as each pip is worth $10. It is not possible to get these big gains with other account types, unless you trade more than a single standard lot.
Disadvantages of a Standard Account
• The initial balance is generally much higher, being at least $2,000. This may be higher in some brokerages.
• The potential for greater losses is much higher. The same way as your gains will be higher, so will your losses. For more on this topic you will want to read this.
Now before you make the final decision I want you to consider this reality. Becoming a Professional Trader takes time and work. Trading for profits successfully is a science – which can be learned but as with any high level profession there are costs. . Would you trust a doctor that tells you that all his knowledge about diagnosing your possible illness stems from reading a couple of books and spending some time on a medical online forum? Or worse, would you let him operate on you?
However there are avenues available to sincere seekers . Find a mentor in one of the many forums. Join Linked in where there is a large and robust community of traders. I personally have over 19000 connections and most are connected to the trading world. You are invited to connect with us there and I will share some good folks to network. Please take this next advice to heart and from someone who lost before I reached my destination.
Do not risk your money until you are confident and patient.
Remove greed and fear from you brain.
We have courses and counsel available to all . We even provide scholarships for those in need so just continue to strive and you will reach
PRO TRADER TOWN
