How to Open a FOREX Account
In our previous article about Forex trading, we discussed what foreign currency exchange is and how it is conducted. What we did not touch upon is how you can open a Forex account and begin trading. Please keep in mind that what we’re sharing here should be carefully considered. Fortunately, you can open a practice account first and then begin your actual trades later.
1. Read broker reviews. If you have a friend who is familiar with Forex and that individual has an account with a broker, then he or she can guide you. Otherwise, you can start off by reading broker reviews to determine where to find a practice account. We’re not endorsing the Forex.com model, but if you go to that website you’ll be given the opportunity to open a $50,000 practice account. Also, at Forex Peace Army you can find broker reviews from users. Read these reviews and consider only those that have been reviewed the most and are rated the highest.
2. Look for registered brokers. Now that you have a good list of brokers to consider, you can trim your list by eliminating those brokers that are not a Futures Commission Merchant. This person should also be a member of the National Futures Association, which is regulated by the U.S. Commodity Futures Trading Commission, a federal agency that was created in 1974.
3. Practice exchanging currency. To familiarize yourself with currency trading, you can practice making trades. On the Forex.com website, you can open a practice account by giving your name, state, phone number and email address. You’ll then be given the choice of website trading or more advanced professional trading for people who are already familiar with FX. A user name and password will be sent to your email address, giving you 30-day access to trading virtual funds. You can skip this step and go to the fourth step if you’re an experienced trader.
4. Sign up. Fill out an application form on the website or print out a pdf form, fill that out and mail it in. You’ll be asked for more detailed information including your bank account details for deposits and withdrawals. Expect to include copies of at least two forms of identification including your picture driver’s license and a banking statement. You may be asked to fax or scan these instead of attaching these documents with your application.
5. Deposit your money. It can take up to five business days for your application to be reviewed and accepted. Once approved, you’ll then be instructed to deposit money into your account. Beginning funds ranging from $25 to $2,500 are usually required; your agent will give you a precise minimum.
Now that your account is active, you can begin trading. Find the trades that work best for you and keep reading up on all things FX to help you to succeed in the world of global currency exchange.