Forex Brokers with Cent Accounts
If you are new to trading forex, then you might want to consider a forex broker with cent accounts. A cent account forex broker enables you can practice trading online with a minimal investment and small position sizes. They are the next step up from trading on a demo account which does not always take into consideration real market conditions and the human emotions that can come into play when using real money.
What is a forex cent account?
A forex cent account is a trading account on which the balance is displayed in cents, and transactions are carried out in cents as well. It means that if you deposit $10, you will have 1000 cents in your account. Trading on the cent account is considered low risk when compared to making a larger deposit and trading standard lot sizes. Therefore, it is an excellent choice for new forex traders who want to learn more about trading online and practice their trading skills.
On a cent account, 1 lot size is 0.01 standard lots or 1,000 units. The maximum volume per trade on a cent account is usually 100 cent lots which is equal to 1 standard lot or 100,000 units.
With the trading volume and position capacity being relatively low in a cent account when compared to a standard account, it does mean that it would have a lower profit potential as well. Not being able to open as many deals with standard lots means it becomes a challenge to earn large profits in a cent account. However, it is better to risk a smaller amount when just starting out.
Cent account vs micro account
The main difference between a forex Cent account and a forex micro account is the trading volume of the forex trading transaction that is opened on each account.
For the cent account the trading volume is equal to 100 units of base currency. For the micro account the trading volume is equal to 1,000 units of base currency.
The micro account (also called a mini account) is the next step up from the cent account. Once a forex trader has had some success on a cent account, they may consider levelling up to a mini account before finally opening a standard account.
Cent account vs standard account
Standard accounts present a minimum volume of trade as a standard 0.01 lot. Standard cent uses an entirely unique measure of volume, namely cent lots; the minimum volume of trade for standard cent accounts is 0.01 cent lots which is 100 times smaller than 0.01 standard lots.
You can usually open a cent account with just $1 whereas standard accounts can require at least $100 or more, depending on the broker. Most of the features that are available with a standard trading account are available to those that open a cent account.
How do I open a forex cent account?
To open a forex cent account, you need to choose a broker that provides them and make a small deposit. You will then be able to trade forex on the provided trading platform along with other financial instruments including stocks, commodities and cryptocurrency.
There is usually no minimum or maximum deposit and no other specific requirements to open a cent account. The main advantage of a cent account is that is lets you trade ‘for real’, thus getting used to actual trading and at that not risking to lose a large sum of money as you could with a standard account. Of course, you can still make significant losses so it is important to make sure you never risk more than you can afford to lose.
Who are the best forex brokers with cent accounts?
There are literally hundreds of forex brokers with cent accounts that you can choose from. The majority of them will have a small minimum deposit requirement. Important things to look out for include the type of forex broker they are, commission fees, spreads, leverage, funding options and customer support. You can see a selection of our best cent account forex brokers below.
Forex cent account pros & cons
- Get started with a minimal investment
- Trade with small positions sizes
- Practice your trading strategies
- Try out a broker to see if they are suitable
- Less risk involved
- Restricted position sizes
- Spreads are usually higher
- Liquidity can be from market makers
- Different emotions when using smaller lots
Conclusion: should I trade with a forex cent account broker?
If you are completely new to trading forex, then I would start on a demo account to begin with. This involves no risk and can be a good way to get your feet wet before making the next logical step up to a cent account. Once you have built some confidence and are seeing good results over the long-term, you may then want to consider opening a standard account. This is usually a straight forward process where you can stay with the same broker but switch your account type seamlessly.
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