What are Mini Forex Accounts?
Mini forex accounts, also known as forex minis, can be used by day traders who do not have or want to trade a lot of capital using contract sizes of 100,000 or more. Mini accounts typically offer contract sizes of 10,000 instead of 100,000 and margin requirements per contract of usually $50 or more (instead of the $1,000 to $2,000 per contract required in regular accounts - the use of high leverage or low margin magnifies both trading gains and losses).
Consequently, mini forex trading accounts have account minimums that are much lower than that of regular accounts (as low as a few hundred dollars or less in some cases). This allows small investors to day trade currencies.
Some currency brokers offer a wider spread for mini accounts and some might charge a transaction per trade. My trading and risk management article may help different traders decide whether they should open a regular account or a mini account, depending on the maximum loss or position size their account can take.
Most of the currency examples discussed on this site assume that a regular day trading account (not a mini account) is used. In reality, if the mini contract is 10,000 units of the base currency, then all of the calculations are simply a tenth of what they would be for regular accounts with 100,000 lot sizes; for example, the value of 1 pip for the EUR/USD on a mini contract will be 1 dollar instead of 10.
Free Forex Strategy E-Book
Just because you decide to open a mini trading account does not mean that you'll be on your own. Test-drive the day trading simulator on this website and you'll have access to my practical trading e-book. It might help you get started trading your forex mini account. Feel free to add it, modify it, enhance it; whatever you want.
Although the trading ebook is very simple, it is also a practical day trading guide that provides specific entry and exit points, along with money management rules and do's and don'ts.
If you have read through this site, you know that I am not a big fan of companies or individuals that overcharge for education (that most of the time isn't even helpful). That's why I put this e-book together.
Happy trading your mini account!
Learn about how to set up and use a mini account in the new forex training webinars given by Trader Abel or go to the day trading account section to open a real account with the firm we use.
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