A cent account, is a forex trading account where the balance is always displayed in cents, no matter how much you deposit. This account type denominates the amount deposited into cents. If you make a deposit of $5 into your account, the balance will be 500 cent. Actually, there isn’t much difference between how a Cent Account works and how traditional trading accounts work. The simple difference is that this type of account allows a trader to trade micro and nano lots.
Cent Account Forex Broker list
MAS, JFSA, DIFC
Why use a Cent Account?
Cent accounts tend to have minimum deposits of around $5 to $10. This will give you quick, easy access to live trading and the markets. Cent Accounts represent a smooth transition from demo Forex accounts before starting to trade larger amounts. It is designed with smaller depositors in mind and those that are relatively new to Forex trading. Traders can also test out strategies without spending great amounts of money too. In fact, they make a great starting point, giving users a real experience with real money as well as an insight to the psychology behind trading Forex but without the great risks that trading in larger sums would bring. The trading environment is also much simpler with a Cent Account.
LiteForex was the first Cent Account Forex broker to offer the accounts back in 2006. It was initially created to help to develop and test trade systems.
The Advantages and Disadvantages of Cent Account Forex Brokers
We talked above about some of the advantages, like how Cent Accounts are great for beginner traders as they permit trading with actual money but without great risk. Additionally, beginners also become used to seeing their money reach thousands, which is a useful tool later, even though they’re currently dealing in thousands of cents. They also allow small deposits for traders too.
The disadvantages of these accounts are that most Cent Account Forex brokers limit the maximum size of the account, to keep their use to a minimum. What is more, even the best Forex Cent Account is usually associated with spreads that are higher to compensate the brokers.
If you’re looking at whether a Cent Account is right for you then you have to consider your own experience, wants and needs from trading Forex. If you have already gained experience in trading Forex through a demo account but are nervous about trading the big bucks, then a Cent Account would make a great next step. You might not get the best deals in terms of spreads, but it does represent a step into the real world of Forex trading without the associated risks that a standard Forex account might bring.