The Forex Market: Opening An Account

Posted by Nick Niesen on October 29th, 2010

Opening a Forex trading account is not a complicated procedure, but there are some decisions that need to be made before you open the account. First you should decide how much capital you are willing to use to open the account, and then investigate brokers until you find one that you are comfortable with. Most brokers will allow you to open a new account with as little as two hundred and fifty dollars for a simple trading account. Check out the different spreads, allowable leverage, margin rules, and other aspects of Forex trading that you consider important. Check out the available pairs that the broker deals with in the Forex market, and make sure that these pairs fit your interests.

Once you know the amount of capital you are going to use for the Forex account and you have found a Forex broker that you trust, It is time to open the account. Figure out what account type you are interested in. Some brokers allow mini accounts, while others insist on full size accounts, and still others have a few choices. Discuss this with your broker to see which account type is best for your investment needs. The best way to proceed if you are new to the Forex market is to start by opening a dummy account with the broker you will use. A demo, or dummy, account will let you get comfortable with the trading strategies before you risk your capital. Once you are completely comfortable with your strategies and your results, then have the broker open your trading account.

Opening a Forex trading account may involve numerous pieces of paperwork and forms, depending on your home country and nationality, as well as the capital necessary to open the account. There are legal agreements between you and the broker that outlines the leverage rules and amounts, the agreement to make good on any losing margin trades, and all the other contracts and agreements that are necessary to open a Forex trading account. As long as you do your homework and investigate your options carefully, finding the right broker and opening an account to trade in the Forex market is easy. The most important part of opening a Forex account is to find a broker that you respect and trust. A Forex broker can make you money or lose you money, so the broker you choose when you open a Forex account can make or break you as a trader.

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