What is a forex live account

What is a forex live account? It is a frequently asked question by forex users, and in order to provide clarification and a response, we shall go into great detail in this piece. One type of forex account that allows a trader to access the market on the broker's platform and trade with real money is a forex live account. It refers to any onboarded account that has the ability to receive transactions for clearing on the date of calculation. In the definition of "what is a forex live account?" There is a crucial point:  the account needs to be funded in order for the user to start trading, meaning that any profit or loss is genuine and impacts the trader's mentality and everyday life. A user can trade a variety of financial instruments, such as currency pairs, indices, metals, cryptocurrencies, and more. In the funded live account, the user funded a certain amount of money a certain time ago; this may have occurred a minute ago or a very long time ago. So, in the forex trading real account users share the risk but also share the rewards. In other words, the user assumes all risks while also enjoying all rewards.

What do you need to open a live forex account?

Since many online forex brokers provide a demo account, users can test out the broker's services and trading platform without committing to a full payment and KYC. This eliminates the need for an initial deposit after the forex real account registration and allows the user to test the broker's accounts and services. But when the user decides to switch from demo to live forex account and/or open a live forex account directly, the brokers require to have several pieces of information and documentation to identify the user to process a forex real account registration. The following information is mandatory for a forex real account:

• Client's legal name

• Client mailing addresses plus contact information (Email, Cellphone, etc.)

• Photos and/or copies of client governmental IDs, like a passport, national ID card, driving license (for cards, both sides - front and back)

• A payment method that has been authorized by the broker to fund the account, like 

• bank account

• credit or debit card

• e-wallet

The user can open a forex real account after the broker has received all of this information and these documents. Depending on how quickly the broker checks user details, starting a forex live trading account with an online broker typically doesn't take long.

How to open a live trading account

Once all above mentioned steps are passed, and then the account must be funded by the broker-approved payment method, such as bank transfer, cryptos, etc., then the user will receive approval from the broker that the account is funded appropriately and the broker will send you the user pass for one of the trading platforms such as MT4, MT5, cTrader, etc. 

To open a forex real account in MT5, users should download the app on their electronic device from the broker’s site, then find the broker’s server and connect to it. 

After the forex real account registration process, the user can specify details of an existing trade account or start creating a new one. In the existing trade account, the user must enter the necessary account information in the "Login" and "Password" segments. This information is the data provided to the user by email, and the server selected in the previous phase is listed below these fields. By pressing the "Finish" button, the user will be permitted to use the selected account at the specified server. For more information, please read our article about opening a live account with detailed information. 

How Much Money Do I Need to Open a Forex Real Account?

The amount of money you are willing to risk may vary depending on why users are trading foreign exchange. But traders are different, and they might not always trade the same way. Compared to day traders, swing traders may need more capital to trade. Also, brokers offer different types of real forex accounts which the initial deposit for each one varies. In general, users’ goals will determine how much money they need to trade foreign exchange, but if they want a bit more freedom, they will need to deposit more money in the forex live account. The point that can be noticed here is that traders can actually start trading in mishov markets by opening a real account where the minimum deposit required is quite low. It’s only $100 to get started.

Types of real forex accounts

There are various types of real forex accounts which each of which has pros and cons of its own. The sort of account that is best for a forex trader relies on several aspects, but can focus on three in particular: 

• Client's initial investment size,

• Client risk tolerance,

• Trading strategy

• The amount of time a client has to trade each day.

So, the client needs to choose the right type of real forex account, which is the best suited to their skill, knowledge, and experience; choosing a proper account type requires careful consideration as it can significantly impact success, potential earnings, and risk management. Based on this information, there are Standard, Mini, Micro, Islamic (Swap-free), VIP/Pro, STP, and ECN account types. Before explaining each of these, I should mention that most of these are different kinds of forex technology & infrastructure that brokers use for their account type models. For example, the electronic communication network (ECN) is a type of automated system that sends the orders out to other people and trading firms and then automatically finds someone with a matching order and executes the trade at the best possible price. It's a system designed to make trades happen quickly and at a fair price, without a middleman getting in the way; or STP (Straight-Through Processing) brokerage is a type of forex broker that gives traders direct access to the big banks, instead of handling trades themselves.

Standard Account is the most common account type that users pick, and is suitable for a wide range of traders. The typical lot size is 100K units of the base currency. One of the drawbacks of this account is the high requirement, which makes it less accessible to traders with limited funds. This kind of account is good for experienced and/or semi-professional traders due to the extra risk involved. Forex traders with less experience can build a trading strategy with a trading plan and then can eventually move on to using a standard account.

Mini Account allows traders to trade with a mini lot size of 10K units of the base currency. As this account needs less capital than a Standard account and provides a reasonable balance between risk and reward, a wider range of traders can use it. However, because it requires less cash, it is difficult to manage effectively, and there is a chance for large losses.

Micro Account enables pip movement of 10 cents per point, and traders can trade with a contract size of 1K units of the base currency. Compared to mini accounts, micro accounts have even lower minimum deposit requirements. As a result, this account might be useful, particularly for traders with little experience in foreign exchange or limited trading funds.

Islamic Account also known as swap-free account, is a unique trading account that has grown in popularity among traders who adhere to Islamic standards. This is a type of live forex account. These real forex accounts are made to abide by Islamic law, which forbids receiving money in the form of interest. Consequently, there are no overnight fees or commissions in the form of interest associated with swap-free accounts.

VIP/Pro Account is designed for high-net-worth people and/or seasoned traders. This kind of real forex account provides smaller spreads, huge leverage, and first-rate services.

STP Account stands for Straight Through Processing account. This account routes trades directly to liquidity providers to execute much quickly. The main disadvantage is its spread, which can fluctuate based on market conditions.

ECN Account stands for an Electronic Communication Network account that provides tight spreads and fast execution. So, this account is reducing trading costs and functioning well in an automated trading system.