There are a lot of recommendation to use forex mini account for new traders. Even so, ensure that you know the advantages and disadvantages of a mini account first so that you know what to expect.

Before starting a business career, most people wants to check the amount of risk and return attached with it. Forex mini account is a best way to minimize the risk with a low startup capital. A forex mini account is just like a regular account with a low investment. $100 are enough for opening a forex mini account. Forex mini account helps the traders who want to get confidence in trading without any big sacrifice. Forex mini account is best for those who want to learn forex.

Every investment is associated with risk and return. The advantages and disadvantages associated with forex mini account are:

Positive points of using forex mini account:

By using a forex mini account you can claim a number of benefits that are:

Low start up cost:

A forex mini account allows you to open an account with only $100 but a regular account charges you $1000. So using a forex mini account is 10 times cheaper than the regular account. It is best for investors because they can start their business with low investment. It is affordable for every person who wants to enter in forex.

Low risk:

As the investment needed to open a forex mini account is less, so less risk is associated with it. In case of any loss the trader will only loss the amount of $100 which is very less in comparison of a regular account. So the traders can trade without the fear of great risk.

Ideal for new traders and investors:

Forex mini account welcome the new comers in the market with its great features. Forex mini account provides the opportunity to traders to enter in the market. So by using the forex mini account the traders can trade in a real scenario. This is very convenient for a beginner that start trading in real market. Such conditions are a good opportunity to become more experienced and confident trader.

Act as a regular account:

Forex mini account is not a demo account. It have the same characteristics and features which regular account has. It provides you the opportunity to trade in real market and also it offers you the reward for your successful trades.

High leverage:

The traders who use forex mini accounts enjoy more leverage. Mini account can help you to earn a decent profit.

Ideal for learners:

Forex mini account provides the opportunity of learning forex market. They can see the market indicators and also can judge the different parameters. Mini account helps the traders to increase their knowledge. In simple words, forex mini account act as a coach for entrepreneurs who want to start their career as a trader.

Disadvantages of using forex mini account:

Each thing has some positive and negative impacts. So the couple of disadvantages that are related with using a forex mini account are

Return is low:

The whole finance is based on the principle of “low risk low return”. So in forex mini account you are putting very low investment in market. You are taking low risk. So according to principle of finance always keep in mind that your return will also low. You cannot earn thousands on a mini account.

High commission:

You has to pay commission for every trade either it is big or small. Through mini account you mostly do small trades. For every trade the broker charges you with commission so you pay more commission to broker in comparison of a regular account.

Low level of facilities:

Most brokers provide less facilities to mini account holders. So you have to make analysis without any help.

Forex mini account is just like regular account but with low startup cost. The several benefits that can be claim by using mini account are low level of risk and capital. But also the disadvantage is your return on mini account is very low but the commission is sometimes high.

Author's Bio: 

If you are a new trader, look into forex trading tips for five principles that will make sure your survival in forex trading. Moreover, check out the details of a profitable trading system that can be learned under sixty minutes at Dr Jeffrey Wilde review.