How does FXCM micro account work?

I was looking around FXCM’s and noticed they offered a micro account for $25 dollars. If I pay $25 dollars would I be trading live or are there some other hidden fees. I always thought you need at least $500 to open a micro account.

If they do open you a live account for $25 dollars would you be able to make trades using only 1-5% of your account balance ($25). So a trade using 2% of your account would risk 50 cents…

dare to dream kenpachi…

I highly highly suggest not opening the account with JUST $25!
I was actually just looking at the page rite now after being enticed by their very low spreads even on micro accounts…

The fact is that if you were to leverage the account 400:1 (which i would not reccommend), the minimum $1000 lot would only decrease your equity by $2.50 which would be already 10% exposure on a $25 account. Now, if you were to incur a 25 pip loss (with 400:1 leverage) your position would already be drained…

What you heard holds true. Regardless of the leverage allowed by the broker, I would suggest opening a micro account with a minimum of a few hundred bucks. and yes, it IS a live account! Many brokers’ strategy with micro accounts is to lure beginners who have no clue what they’re doing to open the account with just $25. No big deal to those that love throwin money away! --They overleverage the account and end up losing their investment before the day’s over.

If you are new to forex trading, make sure you are knowledgeable of the methods and potential risk/rewards involved. AVOID OVERLEVERAGING!! (#1 killer of new traders) I would suggest to go through the school if you haven’t done so already and then possibly paper trade or demo a system until you get the hang of it. If this is old news to you, disregard it.

Good luck with your trading!

Thanks pipnewb, that’s good advice! What would be the lowest (margin and position size) I could use on such an account. I understand the basics of money management and wouldn’t want to risk more than 2% on any one trade to start with.

2% of a $25 account is 50 cents risk per trade, but how many pips would that 50 cents represent? I’m not sure what the smallest unit value 1 pip up or down could represent on such an account.

kenpachi-

like I mentioned, seeing from the website, the minimum position you must open is a $1000 lot. With 100:1 leverage that requires a $10 margin, with 200:1 leverage, a $5 margin, and with 400:1 leverage, a $2.50 margin. The only way to risk 2% on a $25 account ($0.50) is to have a 5 pip maximum loss! NOT GONNA HAPPEN!!!

Let me explain further:
The minimum position to open is $1000. This equates to $0.10 per pip. You can still expose 10% of your account by opening the position with just $2.5 (400:1 leverage) but if you only want to risk a maximum of 2% per trade, your stop loss must be set to 5 pips.

2% of $25 = $0.50

$1000 position = $0.10 per pip

5 pips x $0.10 per pip = $0.50

Hope that clears any confusion

Wow! Thank you for that very detailed and simple explanation I appreciate it greatly - it’s exactly what I was looking for.

Ya, I don’t think I would sign up for that knowing I can only risk 5 pips a trade, I need at least 30.

The point is $25 is too small to trade with. You can sign up but put in more than $25 in the account.

Risk 5 pips per a trade. hahaha welcome to the real trade
u will need to deposit money againt into your account soon.

The pread of most pairs is normally 5 pips already buddy. you already lost your 5 pips before u start enjoy the game.

i look forward to see how u challenge the market with 25 $

i just open FXCM mirco with 100$
Risk 100 pips per trade, worth 10 = 10%
i can only trade 8 times, if i lost 8 times in row. then i need deposit again.

"Risk 5 pips per a trade. hahaha welcome to the real trade
u will need to deposit money againt into your account soon.

The pread of most pairs is normally 5 pips already buddy. you already lost your 5 pips before u start enjoy the game.

i look forward to see how u challenge the market with 25 $

i just open FXCM mirco with 100$
Risk 100 pips per trade, worth 10 = 10%
i can only trade 8 times, if i lost 8 times in row. then i need deposit again."

Um… Try re-reading that a few times and then read the quoted text. Comprehension is key my friend.

Um… Try re-reading that a few times and then read the text you quoted. Comprehension is key my friend.

i did opened a account at fxcm micor and i was thinking to fund it with 100$ and trade with the smallest package (1000$)
i will use SL 100 mainly …but depending on the market moves. (1H-4H-day trading)
I’m a newbie , but i realized that on demo i don t take it too serious …so i think at live i will be more carrefull …and hope i will

but , i don t find from where to change the levarage from 400 to 100 . :frowning:
any help ?

Signed ,
a newb lol

LE : i must loose 1000 pips to loose all the money , right ? (at 100 levarage with 100$ funds )
so like loosing 9 trades at a time . ( the other 100 pips let’s say it will be the spread )