Is it possible to start trading with $100 only? Let’s put a clear line on the things that you CAN do and the things that you SHOULD do. This principle can be applied not just in your personal life but in trading Forex as well. Although you can do it, that doesn’t mean that you should be doing it.
There is a micro-account being offered by FX brokers for many years. This is where beginners can take advantage of starting to trade with as little as $100 as the capital in MetaTrader 4. But there are still other brokers who thought that this micro account isn’t that small enough for newbies, so they created the ‘nano’ accounts. These types of accounts are considered to be ideal for traders with limited funds or want to have small minimum deposits.
But just a simple reminder –FX brokers don’t see you as a friend. In fact, they really don’t care if you open an account or not. What they really want is for you to deposit funds. This is the reason behind the creation of nano and micro-accounts. These small accounts paved the way for FX brokers to gain access to the accounts of clients who cannot fund the huge amount of cash into their accounts.
To say it short, this small type of account doesn’t really benefit the clients, but the broker instead. What’s the point here is that you should be diligent in trading and only trade with money that you can afford to lose.
It is mentioned above that you should start with as little as $100. In this article, you will know what really happens if you trade at only $100 on your account.
Different Types of Forex Account and The Lot Sizes
It is important to familiarize yourself with these terms just so you won’t be alienated the next time you see these words.
Forex accounts have four common types – the standard, mini, micro, and the nano. For the standard type, there are 100,000 units. For the mini, there is a 10,000 unit. The Micro has 1,000 units while the Nano has 100 units. With this, if you trade a standard lot with 1 pip and the EUR/USD is equal to $10, the nano lot will only be equal to $0.01 which is quite small.
It is Possible to Trade With Only $100 But It Is Not Probable
Because of the creation of the nano and micro-accounts, it is not impossible to start trading at $100. There are even others who can have a minimum deposit of $1 in MetaTrader 4. Most brokers of these accounts offer a leverage of 1:1,000. If you combine it with the minimum deposit of $1, then your broker just created a ticking bomb for those innocent traders.
Thankfully, since you already came across this article, you won’t become a victim of this ticking bomb. So, if you are being offered a $100 minimum investment, is it wise to take it? The answer should depend on the different factors, but if you will think it through thoroughly, it is just wise to say no.