Micro Forex or how to trade on cent accounts.
Trading on cent accounts has a number of its own characteristics, ranging from the choice of a cent broker to the volume of transactions performed.
This type of trading, also known as micro Forex, is ideal for beginner traders, as it allows them to practice on a real account without risking large sums of money.
It should be noted that, in addition to technical issues, there is some discrimination against traders who work on these accounts, as their orders are executed slightly slower and the spread may differ from standard account options.
The main points we will cover in this article are the choice of leverage, trading strategy, and the volume of trades.
As well as a number of other nuances that you will encounter when working on micro Forex.
All brokers offer the most favorable trading conditions, so all you have to do is make your choice.
Features of trading on a cent account.
First of all, I'd like to point out that micro Forex isn't just for training. It's also a great way to earn a little money. With luck, you can even double your deposit within 24 hours. However, maintaining it is an even more difficult task.
The main nuances you should know are:
• Leverage size – since you don’t have a lot of funds, you should choose a leverage of at least 1:100, and preferably 1:500, in this case, even trading with a $10 deposit, you can make a significant profit.
It's worth noting, however, that a cent account isn't designed for making money, but rather for testing strategies or advisors, as it allows you to understand how effective your trading approach will be in real-world conditions.
• Lot size – the lot size in micro Forex trading is $1,000, and you can trade in 0.1 lot volumes. This means that the minimum trade size is 100 conventional units, for example, 10 euros. Therefore, you can easily calculate that to purchase a mini lot with 1:100 leverage, you only need $1.30.
You can't count on making a lot of money in this case.
• Size of one point – if during standard trading the value of one point for the EUR/USD currency pair is equal to 1 dollar, then when purchasing one mini lot the point will be equal to only 0.01 dollars or 1 cent.
Now it’s easy to calculate that by opening a trade equal to the volume of 1 lot ($1000) and receiving a profit of 100 points, you will earn a whole dollar.
• A special feature of data display is that units in this type of trading are displayed in cents, not whole currencies. For example, if you have only $1.50 in your account, the trading terminal will display the amount as 150 units. The standard volume of 0.1 lots ($10,000) will be displayed as 10 lots.
Simply put, divide all standard parameters by 100 and you'll get the values used in micro-forex trading. It's even easier to avoid asking this question altogether; the trading terminal will automatically convert dollars to cents.
Micro Forex only allows you to make money in a dynamic market, so choose only those currency pairs that show a dynamic trend.
- Strategy for micro Forex - http://time-forex.com/strategy/strategiya-dlya-tsentovogo-scheta
- Cent brokers - http://time-forex.com/centovye-brokery
