Forum transfer: Submitted by Mike on October 26, 2007 - 14:26.OANDA broker -
www.oanda.com Needless to say they have the best offer for micro accounts. It is not an advertisement, it is what I've learned while looking for a Forex broker and calling, chating with several other brokers.
There are three most crucial things for micro account holders:
- spread for chosen currency pairs;
- leverage options;
- minimum lot size required to open a position;
Majority of Forex brokers have ridiculous offers as to micro account trading. Their conditions of huge fixed lot sizes, extremely high leverage (which can't be altered) and high spreads are made for nothing but creating the riskiest trading environment possible, which leads to small investors losing their money quickly (usually after several losing trades as little as 15-20 pips each a trader can no longer open a new position because of insufficiency of funds), while brokers will have their regular benefits from spreads and large lot sizes...
In addition traders that plan to open a micro account are fooled by demo account trading, where a broker wants you to trade with initially too high account balance, which is inadequate of what a trader wants to invest. Therefore an illusion of easy trading and making big money can be created.
That's all very sad, but is a very common practice among Forex brokers today.
What I personally like about OANDA:
- they have lowest spreads
- they offer a leverage that a trader is comfortable to trade with, in addition they do not try to overleverage traders' investments, and thus don't even offer such ridiculously high leverages as 1:400 or even 1:200
- they don't set restrictions on how much you want to trade at any time, you can open a trade worth 1 dollar if you wish.
I know OANDA is known on this website, I think Edward also uses it. I support his choice.
Mike