Greetings to all! Many novice forex traders don’t fully understand the difference between standard (classic) accounts and cent accounts in Forex. So, I decided to write this little note to clarify it.
So, let’s start.
The balance is displayed in dollars.
The minimum lot is 0.01.
1 point in trading with 0.01 lot is $ 0.1.
Many brokers oriented on beginners, for example, Roboforex and Forex4You, provide an opportunity to open cent accounts.
The balance is displayed in cents; a deposit of $ 20 will look like 2000 cents in such accounts.
The minimum lot is 0.01, but since the balance is in cents, then 1 point of the price action in trading with 0.01 lot is $ 0.01, i.e. just 1 cent.
Thus, the same lot in different types of accounts may indicate a different level of risk.
P.S. Since recently, Forex4You has offered Cent-NDD accounts, where the minimum lot is only 0.01. I.e. 1 point of the price action in trading with a minimum lot is 1/10 of a cent. Such account allows you to perform very accurate money management even with small deposits.
Sincerely yours, Pavel Vlasov