If you are just dipping your toe into the world of Forex, you might be a little apprehensive about starting out in a completely new form of trading with a full-blown trading account.
A number of brokers have started to introduce Mini Forex accounts, designed to provide a less daunting introduction to Forex trading and introduce new traders by removing a significant proportion of their potential liability.
In essence, a Mini Forex account is simply a cut-down version of a standard Forex account that allows the trader to enter positions that are one-tenth the size of the standard lot of 100,000 units. That means that a one-pip change in a currency pair (based in U.S. dollars), is equal to $1 when trading a mini lot, compared to $10 for a standard-lot trade. This obviously reduces a trader’s potential profitability but crucially, it also limits their liability on a trade.
Mini Forex traders are not limited to only trading one lot at a time, making the accounts ideal for increasing exposure as an individual’s trading confidence builds. If a Mini Forex Trader feels confident enough to make an equivalent trade to one standard lot, a trader can just trade 10 mini lots.
A number of brokers have started to introduce Mini Forex accounts, designed to provide a less daunting introduction to Forex trading and introduce new traders by removing a significant proportion of their potential liability.
In essence, a Mini Forex account is simply a cut-down version of a standard Forex account that allows the trader to enter positions that are one-tenth the size of the standard lot of 100,000 units. That means that a one-pip change in a currency pair (based in U.S. dollars), is equal to $1 when trading a mini lot, compared to $10 for a standard-lot trade. This obviously reduces a trader’s potential profitability but crucially, it also limits their liability on a trade.
Mini Forex traders are not limited to only trading one lot at a time, making the accounts ideal for increasing exposure as an individual’s trading confidence builds. If a Mini Forex Trader feels confident enough to make an equivalent trade to one standard lot, a trader can just trade 10 mini lots.
