If you want to start forex trading, you’ll have to pay to put on trades. And I’m sure you stay away for feel of losing your savings. So how much will it really cost?
It depends on whether you opt to trade currency futures or spread trade currencies. Let’s take a closer look.…
With forex trading, you have two options when it comes to trading accounts:
• You’ll need an account for trading currency futures.
• Or an account with a spread trading company.
The costs of trading currency futures
If you opt to trade currency futures, you’ll need an account with a stock broker who offers this type of derivatives trading.
The fees charged vary from broker to broker. But you’re likely to pay a percentage of the value of your trade and a flat fee.
In many instances, you’ll need a balance of $1000 to open an account.
If you already have a share dealing account with a stock broker, you may be able to trade currency futures through them. Just ask.
The costs of spread trading forex
With spread trading companies, the cost you pay to trade comes from the bid offer spread. The spread between the buying and selling price of currency pairs is where a spread trading company makes its money.
If you stick to trading the major currencies, you can expect to pay around 4 pips to put a trade on.
So, you’re a new investor and you’ve read just about everything about mistakes you could possibly make. You’re set to consider what investments out there are right for you, but first some wise words of warning….