What Are Forex Micro and Mini Accounts and How Do They Work?

Have you ever thought of getting into the forex market but thought you needed a large amount of cash to get started? Fortunately, you can get started with as little as $50, although usually the minimum trades are lots of 1,000 or 10,000 units, depending on whether it is a mini or a micro account. Forex micro accounts trade in smaller units, so they are often the easiest to get into right away. Forex mini accounts also deal in small amounts, usually starting at 10,000 units.

How can I open forex micro or mini accounts?

Several brokers offer forex micro or mini accounts. When looking at a forex brokerage firm, ask for the minimum investment. You can also ask them specifically if they do micro or mini accounts. You would open these accounts like you would any other kind of forex account. The difference is that you will invest a smaller minimum amount and will trade in smaller increments. If you are not sure how to get started, look up forex brokers in your favorite search engine. Contact all the brokers you can and ask what they require to get started. Interview each one like you would a job candidate. Find out how much exactly you have to invest, basic investment strategies, the average return, risk management strategies, etc. before deciding on a specific broker.

What are the advantages of a forex micro or a mini account?

The most obvious advantage to either a forex micro account or a forex mini account is that it allows you to get into the market more easily and to trade without risking large sums of money. If you are just learning how to trade in the market or are reluctant to invest large sums in any one account, these kinds of accounts may be right for you. Micro accounts, with their low minimums, are especially useful for beginners to practice and gain experience before moving on to larger trades. Forex mini trading accounts are often ideal for large investors who do not want to put all their eggs in one basket.

Are there drawbacks to opening a forex micro or a mini account?

As with any investment, there is always a risk. This is probably the largest disadvantage to forex mini and micro accounts. On the other hand, a small amount being invested also means that you probably will not make huge profits either. Depending on your reasons for opening an account, these disadvantages might be acceptable. For instance, if you are just learning, it is better to potentially lose smaller amounts. If you are a large investor, you also may want to make smaller trades with the help of forex mini accounts to mitigate risk in other investments.