What Type of Forex Account Do You Need?

There are a variety of accounts that you can create to trade on Forex. Forex brokers create various account types as only one type of account does not meet the requirement of all traders. Unfortunately, most of the traders fail to determine which account type is suitable for their trading practices. That is why we are here today to share with you different types of accounts that would fit the requirements of different types of traders. 

Different Types of Forex Accounts

Although the type of accounts varies from trader to trader, many things are similar in many forex platforms. For example: 

• Standard Account: Traders like to use this type of account when it comes to trading lot sizes, ranging from 1 mini-lot to an extended standard lot. 
• Micro Account: Effective for traders who like to begin at the micro-lot level. 
• VIP or ECN Account: Traders utilize this type of account if they want to trade for more than $50,000. 
• Mini Account: This type of account takes place somewhere between Micro Account and the Standard Account. It is also known as the Classic Account. 

These account types are crafted to meet the needs of the market players. Now, how do you determine which one would be the best as per your requirements? Let’s take a gander at the parameters mentioned below to be able to decide the best type of account according to your requirements.

Size of the account: What type of account would suit your requirement highly depends on the size of your capital. It will help you determine the size of the lot, how much risk do you have for the account, your trade position, and the platform that you will be using for trading exercises.

Based on this Pepperstone review that we found, if you can afford as much as $50,000 to open up an account, you can go for a VIP account. On the other hand, if you only want to spend $200 in your account, you should choose the Micro account. However, if your budget is a bit high, let’s say somewhere between $1000 to $2000, go for Mini or Classic accounts. 

• Experience of trading: Let’s be straight here. If you are a beginner or an inexperienced trader, you have to make use of the Micro account. This is account is recognized as a learners’ account. However, once you complete the professional training session in the forex and become good at it, you can utilize VIP accounts and take advantage of ECn platforms. 
• Goals to make a profit: VIP accounts and Classic accounts are the perfect ones when it comes to trading fast and furiously and withdraw very frequently. However, you can make use of Classic or Mini accounts if your goal is long-term determined, and gradually make it a larger one by exercising 3 to 4 years at least. 

In case you are a Micro account holder, you should not goal to profit. Rather, you have to use the account to trading experiences then step forward to the next account type such as Classic or Standard. 

If you don’t determine which account type you need for your forex trading exercises, you might end up losing all your money. Hence, consider the parameters mentioned above to choose the right type of account that you need for Forex trading.