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Every trader needs a Forex demo account to test Forex trading strategies and EA’s on.
Brokers generally supply these freely.
So have a 30 day limit on demo accounts and other will allow you to use a demo account for as long as you are actively using it.
This is an information sharing website so if you have personal experience of a Forex Broker which has been really good please let everybody know by leaving a response in the facility at the bottom of this page.
This particular page will be updated with more Forex Trading information soon.
Choosing a Forex Broker for your demo account
There are many forex brokers to choose from, just as in any other market. Here are some things to look for:
- Low Spreads – The spread, calculated in “pips“, is the difference between the price at which a currency can be purchased and the price at which it can be sold at any given point in time. Forex brokers don\’t charge a commission, so this difference is how they make money. In comparing brokers, you will find that the difference in spreads in forex is as great as the difference in commissions in the stock arena.
Bottom line: Lower spreads save you money! - Quality Institution – Unlike equity brokers, forex brokers are usually tied to large banks or lending institutions because of the large amounts of capital required (leverage they need to provide). Also, forex brokers should be registered with the Futures Commission Merchant (FCM) and regulated by the Commodity Futures Trading Commission (CFTC). You can find this and other financial information and statistics about a forex brokerage on its website or on the website of its parent company.
Bottom line: Make sure your broker is backed by a reliable institution! - Extensive Tools and Research – Forex brokers offer many different trading platforms for their clients – just like brokers in other markets. These trading platforms often feature real-time charts, technical analysis tools, real-time news and data, and even support for trading systems. Before committing to any broker, be sure to request free trials to test different trading platforms. Brokers usually also provide technical and fundamentalcommentaries, economic calendars and other research.
Bottom line: Find a broker who will give you what you need to succeed! - Wide Range of Leverage Options – Leverage is necessary in forex because the price deviations (the sources of profit) are merely fractions of a cent. Leverage, expressed as a ratio between total capital available to actual capital, is the amount of money a broker will lend you for trading. For example, a ratio of 100:1 means your broker would lend you $100 for every $1 of actual capital. Many brokerages offer as much as 250:1. Remember, lower leverage means lower risk of a margin call, but also lower bang for your buck (and vice-versa).
Bottom line: If you have limited capital, make sure your broker offers high leverage. If capital is not a problem, any broker with a wide variety of leverage options should do. A variety of options lets you vary the amount of risk you are willing to take. For example, less leverage (and therefore less risk) may be preferable for highly volatile (exotic) currency pairs. - Account Types – Many brokers offer two or more types of accounts. The smallest account is known as a mini account and requires you to trade with a minimum of, say, $250, offering a high amount of leverage (which you need in order to make money with so little initial capital). The standard account lets you trade at a variety of different leverages, but it requires a minimum initial capital of $2,000. Finally, premium accounts, which often require significant amounts of capital, let you use different amounts of leverage and often offer additional tools and services.
Bottom line: Make sure the broker you choose has the right leverage, tools, and services relative to your amount of capital.
For more information about the above article please use this link:- http://www.investopedia.com/articles/trading/04/081804.asp
3 Comments
John Sampson
April 29, 2015From the article above:
” Forex brokers don\’t charge a commission…..”
News to me. I shall forthwith write to all my brokers demanding refund of all commission amounts shown in my terminal (present and past).
As a general comment. The advent of high-speed algo-traders has to a large extent taken over the task of currency pair manipulation and retail trader exploitation previously enacted by a cabal of large institutional liquidity providers (banks, large investment firms, hedge funds etc). Result of this regulator intervention has meant that the email and phone-call based manipulation at dealer-desk level has now “gone underground” and been mechanised in the form of software based fluxes insinuated upon the daily trade price action. They take it up, they take it down in broken sinusoidal phugoids. You really need to be “plugged in” to be able to identify the “suck-in and take-in” phase-timings. Brokers are non-participants here because they make their money from the spread flux and commissions and swap…. not to forget their volume (which is the predominant factor).
Some of the smaller brokers still rely upon spiking, timed spread widening, server stalls, server lockout periods for NFP, artificially induced slippage and the like in order to sustain their bottom line. To do this, they utilize the “Metaquotes Trade manager”. This is a utility provided to brokers by Russian company Metaquotes that can be used to actively bias outcomes against individual traders (although sometimes used “en bloc”). However this fiddling at the margins cheating is by no means as effective as the algo-trading software in regularising the “take” from retail traders. That the industry has become much more subtle and regulator-compliant is undeniable. What retail traders should do to become disinvolved in this process is a matter for debate.
Alex du Plooy
May 8, 2015Good idea, John – remember to quote this reference http://www.investopedia.com/articles/trading/04/081804.asp Let us know what success you experience
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