There are currently millions of people from all over the world who prefer forex trading as their business of choice. It is a fascinating and profitable business. Even so, the question many people always ask is, is it a business anyone can venture into and begin selling and buying immediately?
The short answer is yes. This foreign exchange market is accessible by anyone. Trading is also relatively straightforward. Even so, there are factors prospective traders ought to put into consideration before they get immersed fully into the world of foreign exchange.
Registering an account
To be able to trade currencies successfully, you must be highly skilled and knowledgeable. The best way to know just how skilled and knowledgeable you are is by setting up an account. There are currently many different types of brokers. However, you must choose a regulated and licensed firm such as JunoMarkets.
It is also worth noting that most licensed and reputable brokers won’t simply accept you in. You will have to provide specific credentials. That way, your identity can be verified and confirm that you have what it takes to trade forex. The information some of these auto trade forex brokers will ask of you include:
- Personal information: You will be asked to give out a lot of your personal information when creating an account. The information typically includes your name, phone number, email, residence or citizenship, address and date of birth. Whilst this sounds like standard information, you may also have to give out your tax, information number, employment status etc.
- Financial information: When signing up for a trading account, you may also have to give out your financial information. Information like your worth (net) and annual income. Depending on the broker, you might also be asked to fill out a questionnaire. This questionnaire will highlight your trading objectives, financial experience and knowledge.
The Verification Duration and Process
After filling out all information, the broker will then process all the information. It is also not uncommon for brokers to request additional documents. Even though this may get frustrating, it is a crucial part of the confirmation process. You may be asked for a copy of your national ID or passport. You may also be asked to give out a utility bill as proof of residence.
Once all information is confirmed, you will be given a trading account within a specified time frame; usually, within a day or two. This may come out as being a tad bit tedious, but it is proof of the nature of business you are entering in terms of how serious you should take it.
Types of Trading Accounts
The following are some of the many different types of accounts available:
- Live and demo accounts
Every auto trade forex broker offers these accounts. Demo accounts are a simulation version of the real trading account. On the other hand, a live trading account is an opposite.
2. Standard and mini account
The mini accounts are for those who have smaller starting investments. Standard accounts allow trading of standard leverage and currency lots. Each of these two accounts has a minimum capital prerequisite, and it varies depending on a broker.
3. Managed account
High-net investors primarily use this. In most cases here, investors prefer to have their wealth managed by wealth management firms. It is also here where the capital belongs to the investor but the power to sell and buy lies solely with the firm.
The last step to registering for a forex account is warnings and risk disclosures. This is as important a part as any other. More so, if you are a beginner. Forex trading is a high risk, especially if you don’t possess a deep understanding of the forex market. Also, familiarize yourself with rules that govern trading to avoid disappointments in your trading endeavor. Remember, if you are not careful enough and are too enthusiastic, you stand a chance of losing your money within the first few hours of trading.
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