Many brokers have developed in the financial business as a result of the growth of Forex trading. In many respects, they are dissimilar to one another.
Many brokers have developed in the financial business as a result of the growth of Forex trading. In many respects, they are dissimilar to one another. Bonuses are a critical consideration for many traders when selecting a brokerage firm. It is tough to attract more clients to your platform without them in today’s fierce competition. As a result, FX brokers strive to come up with unique ideas and promotions as often as feasible.
Not all bonuses, however, can be trusted; some are either difficult to satisfy or are hoaxes. Some of them exist solely to defraud clients of their funds. We’ll show you how to recognize the difference between legit bonuses and scammers in this post.
What is the difference between a Forex Promotion and a Forex Trading Promotion?
All traders adore forex bonus and promotion. In essence, this is an offer that provides consumers with more dollars to be used for trading later on. Deposit bonuses, no deposit bonuses, contests, and short promos are some of the several sorts of Forex bonuses available.
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Consider These Points to Help You Tell the Difference Between Bonuses
You should consider various criteria before collecting any incentive.
Examine a Broker’s Credentials.
Any broker’s first and most significant feature. Always find out more information on a broker’s authority and licensing before registering on their website and checking bonuses. In general, trustworthy brokers will always give fantastic promotions to their consumers, but fraudulent brokers will either lack a license or have no real-world expertise in the FX market.
Check the Conditions of Turnover.
Beginner traders are prone to making mistakes and failing to pay attention to the finer points of the transaction. These criteria are often so strict that converting the bonus money to cash and withdrawing it later becomes difficult. Another aspect that distinguishes legitimate bonuses from those that are a fraud is this. It’s not uncommon to have to turn the money over 50 times, which is impractical. A limit of more than 10x is infrequently established by regular brokers.
Minimum Deposit Requirements should be avoided at all costs.
Brokers that are out to defraud their consumers will always need a minimum investment to obtain bonuses. In order to receive a deposit bonus, you must first deposit a specified amount of money into your account. Deposit requirements might be too high with questionable brokers. If you believe the sum is unusual, decline the bonus and walk away.
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Drawbacks of forex bonuses
Given that we’ve been discussing Forex bonuses and how to tell the real ones from the fakes, it’s time to look at some additional facts. Because the benefits of brokerage company special offers are self-evident, it’s only natural to discuss the drawbacks of Forex bonuses as well. For instance, Libertex offered on broker websites, according to experts, have the following drawbacks:
- It is not possible to use the additional reward as a margin. The truth is that the brokerage business will cancel the incentive payment if the balance falls below the necessary level.
- Brokerage firms that provide a no-deposit Forex bonus typically have stringent trading volume criteria, which are sometimes impossible to meet.
- In certain circumstances, the wagering requirements for a bonus are unclear, causing a novice trader to lose not only the bonus but also his own money.
- These drawbacks are precisely the chasm that separates a trader’s predicted success from actual financial losses. As a result, it is critical to thoroughly examine the terms of a Forex bonus before utilizing it.
With these 7 criteria you will find the right forex broker
- What is the minimum deposit?
To participate in Forex trading, you must deposit a minimum amount when opening an account. The amount of the deposit varies from broker to broker.
- What is the maximum leverage that can be selected?
Currencies are traded with a lever in Forex trading. This means that only a small part (the margin) of the total value of a position is deposited. So, it is possible that with a small bet you can trade a much larger position.
- What bonus payments does the broker offer?
Some providers advertise with a bonus for new customers. In most cases, the bonus depends on the amount of the deposit and the number of trades within a certain period of time.
- What lot sizes can you trade with?
A standardized contract, the so-called lot, is used on the foreign exchange market. A standard lot has an equivalent value of $ 100,000. If the broker supports it, this value can be reduced to $ 10,000 (mini lot) and $ 1,000 (micro lot).
- How high are the spreads of the respective broker?
The spread is the difference between the buying and selling price. The lower the spread, the less costs you will incur. The respective amount is variable with most brokers and can be very different depending on the market situation. In particular, the publication of economic data that has a direct influence on exchange rates can lead to a widening of the spread. In comparison, the minimum spread for the EUR / USD currency pair is given, as this is particularly popular.
- Does the broker offer a demo account?
With a forex demo account, you have the opportunity to test the respective trading platform of the forex broker under real conditions with virtual capital without risk.
- How many currency pairs does the broker have to choose from?
In addition to the main currency pairs, the so-called major pairs EUR / USD, USD / JPY, USD / CHF and GBP / USD, there are a number of other interesting currency pairs. You can find a comparison of the offers of the individual forex brokers.
