A new forex trader might be tempted to use a mini account with their automated forex software. These are real live accounts that use lot sizes one tenth the size of standard accounts. They can be found in any corridor these days.
A new trader has a number of options:
1. From the start, use a standard account and trade live, using between $1,000 and $5,000. Obviously, this is not the best thing for a student.
2. Get started with live trading on a forex mini account. You usually need $250 for these accounts, but you may be able to find brokers that will let you start with even less.
3. Start with a demo account where you gain trading skills without investing any real money at all, then when you consistently make profit, switch to a mini or full size brokerage account depending on your capital reserves and strategy. .
Disadvantages of a mini trading account and online forex software.
As you trade smaller lots, you will pay more commission to the broker. Your earnings will be consumed in more. This could affect whether you make a profit or a loss in the long run. Therefore, it is advisable to trade a mini account only until you have enough capital to switch to a standard account.
Whatever your choice, remember that currency trading carries risks, like all investments that promise big returns in a short time. Only risk money that you can afford to lose.
Also, you need to choose the best forex software. This is essential if you are going to become a trader. A good forex robot will mean that you are constantly in the know. You won’t have to be in front of your PC day after day. The robot will take care of the technical analysis for you and enter and exit trades. If you don’t, the task will be too difficult. All other traders use software, so if you choose not to, you will be at a real disadvantage.