How to Open a Forex Trading Account

How to Open a Forex Trading Account (1)

Want to open forex trading account? Forex trading means trading in the global foreign exchange market. Traders require a trading account for the same to initiate transactions. Interestingly, the foreign exchange market is the most liquid one globally. 

The average turnover of the market is around 6.6 trillion dollars a day. Due to the large number of traders across the globe, the market is the most popular market. Traders need a bank or broker to complete their transactions.

In this digitally running world, the best option is an online broker that renders many features. Therefore, traders must know how to open a forex trading account.

What Is a Forex Trading Account?

An online trading account allows you to store multiple currencies and trade in them. The forex market is the market that is responsible for determining the exchange rates for different currency pairs.

The exchange rates of the currencies fluctuate based on multiple elements. Fundamental and technical factors are responsible for the change in prices. The price manipulation in currency pairs invites enormous profits for traders.

Traders can open a trading account with an online broker. There are various brokers in the market, so choose wisely. After a successful opening of your trading account, trade in the forex market.

The base and quote currencies are exchanged in pairs. 

Understanding Currency Pairs

The foreign exchange market makes currency pairs to determine the exchange rates. A pair is a combination of two currencies, the first one is the base currency, and the second is the quote currency.

The exchange rate denotes how many units of the base currency can be bought with one unit of the quote currency. This is how traders can buy and sell currencies. There is no typical science behind it.

Types of Currency Pairs

The currency pairs are divided into three major types. Forex traders can segregate highly profitable to least profitable pairs with the help of these categories. The categories are:

Major Currency Pairs

These are the pairs that include US dollar (USD) in it. The currencies of the strongest economies are paired with the US dollar. These are also known as the highest profitable currency pairs of the market.

These pairs include EUR/USD, GBP/USD, USD/JPY, USD/CAD, and various others.

Minor Currency Pairs

These are pairs that are less profitable as compared to the major pairs. The strongest economies of the world are included in these. They are more stable, and due to this, the profits are less for traders.

These pairs include EUR/GBP, EUR/JPY, AUD/NZD, and several others.

Exotic Currency Pairs

These pairs are made from currencies of emerging economies. They are weaker currencies, and traders trade less in them to avoid the risk of loss. That is why these pairs are the least profitable pairs in the forex market.

These pairs include EUR/TRY, GBP/ZAR, AUD/MXN, USD/THB, and various others.

How to Open An Account

The process to open a trading account is quick and sweet. Before we head towards the process, you must have all these things. Here is a requirement list, things you need to open a trading account are:

  • A trustable broker
  • An email address
  • A contact number
  • Bank account to make transactions
  • Any taxation ID
  • Employment status
  • Citizenship status
  • Proof of income (if required)
  • Any various other things

Procedure For Opening An Account

The process of opening a forex trading account is not a difficult task. Traders need a few things before they start the process. You have to verify your identification as well as a payment method for smooth transactions.

Finalise an online broker among several brokers present in the market. Make sure the broker you are opting for is giving all the required benefits and facilities. After that, follow the process listed below to open your trading account:

  • Open the website or mobile app of the broker to start the process and make your trading account.
  • Choose the type of account that is most suitable for you among the various accounts offered by brokers.
  • After selecting an account type, fill in the form for account opening. Put all the details correctly as asked by the trader.
  • Once you fill the form successfully, you will be assigned a username and a password to access your account.
  • Log in to your account, and to start trading, you have to deposit some funds from the options available to use them.
  • Once the funds are loaded into your account, you can make a trade in the open market with the help of the broker.

It is the whole process of opening a forex trading account. After completing this, traders can trade in the forex market. Enjoy the benefits of trading forex with the best broker.

Benefits of Forex Trading

Forex trading is a typical thing, and for some traders, it might feel boring. However, there are many benefits of forex trading that traders can enjoy. The benefits are as follows:

High Leverage

Traders indulge in forex trading due the possibility of high leverage. Online brokers render better opportunities for leveraging in the FX market. It means with lesser investment. You can trade more and make higher profits from the market without having a bigger amount in your deposit account. Therefore, trading with leverage is highly profitable and allows you to aspire for more.  to

Lower Costs

Another biggest advantage of trading in the forex market is that the transaction cost of the market is very low. Generally, the cost varies in pips that are denoted in decimals. This means the cost is very low, and the profits are very high in forex trading.

Margins

Margins are known as the minimum balance a trader needs to keep in the trading account. The requirement of margins is lower in forex accounts, and the availability of leverage is high. It means that profits get extracted at the maximum rates.

Higher Liquidity

The liquidity of the market is very high, which means that the participants are large in number. As per the records, the average daily turnover of the forex market in the last year was 6.6 trillion dollars. Hence, this market is highly liquid.

Fast Execution Speed

Traders can make trades easily with a fast speed due to high liquidity. All your orders are completed at a faster speed, and profits can be maximised. Therefore, the amount of profits earned from the market is maximised with the help of this.

The Best Online Forex Brokers

To open a forex trading account, traders need to choose the best online broker. After conducting in-depth research, these brokers have proved to be the best online brokers. Traders should compare different brokers before they select one for themselves.

A few of the brokers you can consider in your studies are as follows:

HFTrading

  • A free demo account for all the traders to experience the forex market.
  • The ASIC and FMA regulate the broker to ensure protection.
  • Traders can start trading with a minimum deposit of 250 dollars.
  • The maximum leverage offered by the broker for forex traders is 1:500.
  • There are many other trading assets available for traders.
  • Zero commission trading with tight spreads and low swap charges.
  • Traders get MetaTrader 4, Mobile app, and WebTrader trading platforms.
  • A vast collection of educational and research material is accessible.
  • The broker is also offering dedicated customer support 24/5.
  • There are several funding options to manage your funds efficiently.

TradedWell

  • A free demo account for all the traders to experience the forex market.
  • The CySEC regulates the broker to ensure protection.
  • After making a minimum deposit of 250 dollars, you can start trading.
  • 1:500 is the maximum leverage offered by the broker for forex traders.
  • There are many other trading assets available for traders.
  • Zero commission trading with tight spreads and low swap charges.
  • Traders get MetaTrader 4, Mobile app, and WebTrader trading platforms.
  • A huge collection of educational and research material is accessible.
  • The broker is also offering dedicated customer support 24/5.
  • There are several funding options to manage your funds easily.

Global TradeATF

  • A free demo account for all the traders to experience the forex market.
  • The IFSC regulates the broker to ensure protection.
  • Traders can start trading with a minimum deposit of 250 dollars.
  • The maximum leverage offered by the broker for forex traders is 1:500.
  • There are many other trading assets available for traders.
  • Zero commission trading with tight spreads and low swap charges.
  • Traders get MetaTrader 4, Mobile app, and WebTrader trading platforms.
  • A huge collection of educational and research material is accessible.
  • The broker is also offering dedicated customer support 24/5.
  • There are several funding options to manage your funds easily.

The Bottom Line

The process is quick and simple to open a forex trading account. All traders need to do is research the market. They have to learn the fundamentals of trading and choose a reliable broker for trading.

Make your decision carefully while selecting the right currency pair and broker. All this has to be done after studying the market and technical & fundamentals of the currency pair. Earn good returns by trading in the forex market and make money.

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