Forex Brokers with Mini Accounts
There are a few main types of forex trading accounts that you can choose from. This is likely to depend on your experience level and how much risk you want to take. A mini forex account will let you practice your forex strategies using a minimal investment. This can be a good way to hone your trading skills, build confidence and control your emotions before making a more substantial financial commitment. If you don’t want to trade on a demo account but at the same time want to reduce your risk as much as possible, then a mini forex account might be for you.
What is a forex mini account?
A forex mini account is a foreign exchange (FX) account which allows new forex traders to trade currency pairs using smaller lot size (mini lots) positions and trading quantities. This means that beginners can start trading forex with less funds and limit potential losses when compared to a typical standard account.
A mini forex trading account involves using a trading lot that is one-tenth the size of the standard lot of 100,000 units. In a mini lot, one pip of a currency pair based in U.S. dollars is equal to $1, compared to $10 for a standard-lot trade. The demand for micro accounts when trading forex is particularly high with new traders. Mini and micro accounts have remained an essential part of the forex trading business, and that is why a majority of forex brokers provide them.
Forex mini account vs cent account
The main distinctive feature of cent accounts is that they use 100x denominated monetary units of the base currency (USD, GBP, JPY, CAD, CHF, AUD, etc) while the trading conditions are the same as those you can get on standard accounts.
As a result, forex cent accounts can be an excellent choice not only for beginner traders, but for professionals as well. This is because cent accounts can help them to test new trading strategies or expert advisors (automated systems) in real market conditions without any significant financial risk.
Forex mini account vs standard account
The standard account is the primary trading account at the core of forex brokers. One standard lot equals 100,000 currency units. Therefore, if your account base currency is in US Dollars, the pip value for each currency pair where the US Dollar is the quote currency equals $10. A pip is the fourth decimal in a quote, and the quote currency refers to the second one listed in a pair.
Compared to a standard account where traders can enter into contract sizes of 100,000 units of a standard lot, a mini account only allows 10,000 base currency units. This means that mini accounts are more suitable for traders who want to make a minimal investment and trade small position sizes.
Forex mini account pros & cons
Pros
- Trade with less risk
- Low initial deposit required
- Practice your trading strategies
- Step up from demo trading
- Test a brokers trading condition
Cons
- Spreads and fees are not always the cheapest
- Does not have the same emotion as trading larger amounts
- Not all forex brokers provide mini accounts
- Do not always get priority on liquidity
- Limited profit potential
Which forex mini account broker is the best?
There are hundreds of forex brokers that have mini accounts which can be narrowed down depending on what your specific needs are. You need to consider things such as the minimum deposit, account types, spreads, commission, leverage, funding options, markets, regulation and support. You can see a selection of our best forex brokers with mini account below.
ASIC, BaFin, CFTC, DFSA, FCA, FINMA, FMA, FSA, FSCA, JFSA, MAFF, MAS, METI, NFA
$250
1974
1:200
Conclusion: should I open a forex mini account?
It really depends on your currency experience level. If you are an absolute beginner and have zero experience trading forex, then I would open a demo account to begin with. Once you start seeing some results, you might want to take the step up to a forex cent account or mini account.
Further down the line, you could switch over to a standard account. However, it is better to take baby steps and understand that learning how to trade takes time and lots of practice.
It is also important to keep in mind that account features can vary between forex accounts. Some brokers might require you to have a standard account and make a minimum deposit of at least $200 (or more) to get access zero pip spreads and ECN conditions.
You will also be restricted on your position sizes when using a forex mini account and might not get priority execution in the liquidity pool. However, if you are only planning on trading small positions, this shouldn’t be an issue.
You will find that there are plenty of forex brokers that provide all types of forex accounts, so you shouldn’t have any trouble switching between them depending on your current circumstances.
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