Tag: Forex bonus

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Forex Basics

Tempted to Take Advantage of Forex Promotions? Read This First!

When choosing a broker, there are a lot of factors to consider, from available account types to deposit/withdrawal methods, commission fees, and so on. There is also a lot of competition out there, as the number of available brokers continues to skyrocket. In an attempt to stand out from the competition, many Forex brokers offer […]

When choosing a broker, there are a lot of factors to consider, from available account types to deposit/withdrawal methods, commission fees, and so on. There is also a lot of competition out there, as the number of available brokers continues to skyrocket. In an attempt to stand out from the competition, many Forex brokers offer […]

When choosing a broker, there are a lot of factors to consider, from available account types to deposit/withdrawal methods, commission fees, and so on. There is also a lot of competition out there, as the number of available brokers continues to skyrocket. In an attempt to stand out from the competition, many Forex brokers offer extra perks to attract new customers, with many of those perks being related to deposit bonuses (or welcome bonuses, re-deposit bonuses, etc.), and promotions. Today, we will cover the various types of promotional opportunities that are out there and how you can get the most out of those offers while avoiding scams. 

Refer-A-Friend

Through referral programs, trader A refers trader B and earns some type of reward for doing so. Sometimes, even trader B gets rewarded, although it always as much. Usually, the reward is a cash amount ($5 or more) that is added to the trading account of the referring/referred traders. There might be requirements for the referred client to deposit a specific amount for these rewards to be credited, so be sure to check for any conditions. In other cases, the referring trader gets to collect commissions from the referred trader’s trades. The second example is usually more of an IB account situation, but we have seen this setup before with partner programs. There are often limits on the number of traders one can refer, or there may be limitations on the maximum amount one can earn through this program. 

Rebates

Rebate programs are often labeled as ‘cash back’ promotions. Both adhere to the same concept, where traders would earn back some of the spread costs from trading through rebates. Volume is usually the requirement for earning these rebates. Fortunately, this means that one can simply trade as normal and earn money back by doing so, with high-volume traders seeing the most benefit in this situation. 

Free Stuff

Through these promotions, brokers offer a free prize that can be earned by meeting certain requirements. Offers can vary widely, although iPhones, cash prizes, laptops, and paid trips to different locations are some of the most common rewards. Of course, it usually isn’t easy to obtain any prize with a cash value of $500 or more. Requirements generally revolve around depositing a certain amount of money into the trading account, trading a certain number of lots, etc. Many brokers change up their offers every so often, so be sure to check for specials, like holiday promotions. 

Loyalty Programs

Loyalty programs typically reward traders with cash prizes, bonuses, points that can be used towards different rewards, and so on. Points are usually earned by making deposits and trading in general. In some cases, one might advance to a new tier with better rewards as these tasks are performed. This is one of the areas that varies more widely, as each broker comes up with their own loyalty reward system. 

Contests

Many Forex brokers hold contests that reward the winners with prizes, which can include cash money, prizes, trips, and other rewards. One of our favorite types of contests involves demo accounts, where the person(s) who make the most profit trading on a free demo account are awarded a real cash prize. Contests are often held on real accounts as well, and many of them reward 1st place with the best prize, 2nd place with the next best prize, and so on. Many contests revolve around who can make the most profit, or other criteria. 

Avoiding Scams

Here are a few tips for avoiding promotion-based scams in the Forex industry:

  1. Always read the terms & conditions for any promotional opportunity before participating. 
  2. With Refer-A-Friend programs, you’ll want to check to see if there is any limit on the number of people you can refer. Also, brokers often require the referred client to make a deposit into their account before you will be credited with your reward. Check and make sure that said person plans to meet that deposit requirement. 
  3. Remember that no broker is going to give an expensive item away for free. There will always be conditions that have to be met before you will be able to earn “free” items like iPhones, laptops, etc. 
  4. If the broker holds a reoccurring contest, check to see if previous winners are announced on the website. This is a good sign that things are genuine. 
  5. Don’t assume that you are automatically in the running for any contests without checking to see if you need to email support or enter the contest on the website.
  6. Remember that if something sounds too good to be true, it probably is. Many brokers make it sound quite simple to earn rebates and rewards when the terms & conditions reveal that it is more difficult than it seems. 
  7. Check to be sure that your chosen account type is eligible to participate in certain promotions. Some brokers offer all bonuses and promotions to everyone, while others only offer the best options to those with higher-tier accounts. In other cases, VIP account holders may be excluded from certain contests, rebates, etc. 

Conclusion

There are many different promotional opportunities out there, and most fall into one of the categories we’ve outlined above (Refer-A-Friend, Rebates, “Free” Stuff, Loyalty Programs, and Contests). However, each broker offers its own promotions, so offers can vary significantly. As always, read through the terms & conditions for each promotion before participating in any contest or attempting to earn any rewards and check for signs that the advertised rewards are legitimate.

Categories
Forex Brokers

What Are the Most Common Forex Broker Promotions?

Currently, the number of online Forex and CFD brokers has multiplied and everything seems to indicate that this trend is certain to continue in the near future. These markets have become significantly popularized worldwide and these companies seek to take advantage of the boom of these sectors as more and more people seek to make […]

Currently, the number of online Forex and CFD brokers has multiplied and everything seems to indicate that this trend is certain to continue in the near future. These markets have become significantly popularized worldwide and these companies seek to take advantage of the boom of these sectors as more and more people seek to make […]

Currently, the number of online Forex and CFD brokers has multiplied and everything seems to indicate that this trend is certain to continue in the near future. These markets have become significantly popularized worldwide and these companies seek to take advantage of the boom of these sectors as more and more people seek to make profits in the financial markets, which potentially can offer great benefits to the trader.

Due to the strong competition among online brokers, which is growing, these companies have started to offer different promotions to their clients (both new and existing), ranging from fund deposit bonuses to trading competitions with excellent rewards to winning traders.

  • In general terms, the objectives of these promotions are:
  • Attract new customers who open trading accounts and deposit funds.
  • Encourage existing customers to make additional deposits of funds.
  • To ensure that existing customers operate regularly with the broker, carrying out transactions frequently and with an increasing volume of trade.

In this section of the article we will describe the main types of promotions offered by Forex brokers and online binary options:

Bonds for the Deposit of Funds

As their name suggests, they are bonuses that clients receive when they open an account with a broker for depositing funds with the aim of trading in the market. Usually, the amount of the bonus is a fixed percentage of the capital deposited by the customer (10%, 20%, 30%, 50%, 100%, etc.) or a fixed amount of money depending on the trader’s deposit, such as $100 for a deposit of $500 or $300 for a deposit of $1000. We can distinguish two basic types:

Welcome Bonuses: These are deposit bonuses that apply only to the first deposit made by the customer after opening the account. Depending on the broker and the promotion, we can find welcome bonuses up to 100% or more.

Bonuses for each deposit: These bonuses apply to each deposit made by the trader in your account, not just the initial deposit. They aim to encourage trader loyalty and get you to deposit more money into your account.

There are also promotions of this type in which the broker grants a bonus to the customer for depositing funds through a specific payment system such as Skrill or Neteller, for example.

In most cases, deposit bonuses can be withdrawn once the trader meets a number of requirements (depending on the promotion), such as completing a certain volume of trades in the market, for example. In other cases, the bonus cannot be withdrawn but can be used as an additional credit to trade in the market. It is recommended to carefully read the conditions of the offer as some brokers stipulate almost impossible conditions to fulfill for the withdrawal of the bond.

Free Bonus without Deposit

These promotions consist of free bonuses that do not require a previous deposit from the customer. In other words, the only requirement is that the trader opens an account with the broker. In some cases, the customer is asked to verify their identity, email, mobile phone, or current address, while in others the trader receives the bonus just open the account.

Usually, the bonus amount is $5 to $100 depending on the promotion. The trader can use the bonus to trade in the market with complete freedom and can keep the gains from their trades. You can usually withdraw your winnings even though some brokers require additional conditions that many might call unethical.

In most of these promotions, the bonus money cannot be withdrawn (it is only for trading purposes). Although in some cases this is possible, but for this, the trader must fulfill a series of quite difficult conditions (usually must complete a certain volume of trades).

Promotions of Cash Rebates

They can be said to be bonds for trading in the market. Cash rebate promotions consist of the return of a percentage of the profits earned by the broker (usually a percentage of the spread) with the trades performed by the customer. This return is given in the form of an amount of money determined by a trading volume unit (such as X USD per standard traded lot). Therefore, the more frequency and volume a trader trades, the more money they can get through these promotions. Traders who do a lot of intraday trading get a significant additional amount of money through cash rebates as there are no limits on the amount they can earn (the more the trader trades, the more the broker earns).

In some cases, the amount of cash rebates a trader can earn depends on monthly trading. In other words, the broker may increase or decrease the profit per lot traded based on the monthly volume of trades made by the trader. For example, a broker can offer a standard cash rebate of $3 per lot to traders who complete a trading volume of 100 to 200 lots and a standard cash rebate of $5 per lot to traders who complete a volume of 200 to 1000 lots. Of course, this depends on each broker and the promotion.

Trading Skills

They are tournaments organized by brokers where their clients compete in tournaments that offer cash prizes to the winners, in some cases quite good. Usually, the winners are determined according to their performance as traders or by some other condition (for example, traders who carry out the greatest number of trades or complete the largest trading volume during the period of the competition). Its duration is variable, from a few hours to several months. We can distinguish two basic types:

Real Account Competitions: These are real account trading tournaments in which traders trade with real money and therefore carry a level of risk for the customer, as they may lose part or all of the capital of their account. These competitions usually offer the biggest prizes to participants, in some cases thousands of dollars.

Demo Account Competitions: These are trading tournaments for demo practice accounts in which traders trade with virtual money. Therefore, they do not present any level of risk for the participants, although the prizes are usually less than those offered by the competitions for real accounts.

Bonus for Referring Other Customers

These are promotions in which the broker gives the customer a fixed bonus for referring other clients who open an account with the company and deposit funds. These bonuses are paid only when referred traders deposit funds into the account (there is usually a minimum amount for the bonus to be credited). An advantage of this type of offer is that there are no limits as to the number of customers that can be referred, which means that there is no limit to the amount of bonuses that can be obtained.

In some cases, the broker increases the amount of the bonus depending on the number of referred traders, meaning that it rewards the customer for their performance. For example, a broker can pay $150 to refer 1-50 traders and $200 to refer 51-100 traders. Money from these bonds can be withdrawn without restrictions or used to trade in the markets.

Free Seminars and Webinars

Some brokers offer on a regular basis free seminars and webinars focused on different topics of trading and financial markets and/or company services. They are usually quite educational and can be quite useful for novice traders interested in learning about financial markets. Some brokers offer seminars and webinars on a wide variety of topics, such as trading strategies, technical analysis tools, fundamental analysis, monetary management, risk management, graphical analysis, and many others. These promotions are a useful resource that can be taken advantage of even by more experienced operators.

Bonuses and Forecasting Competitions

It’s a relatively new kind of promotion. They are basically competencies that reward the customer for forecasting the outcome of various key indicators (such as Non-Agricultural Payroll), the latest quote of a given instrument (such as a currency pair such as EUR/USD) at the end of a specific period, or by carrying out precise market analyses and forecasts.

Winners usually get cash bonuses that are deposited in their accounts and can be withdrawn. Depending on the promotion, in some cases, the withdrawal of prizes requires the customer to comply with a number of conditions, such as completing a certain volume of trades in the market.

Drawing with Prizes for Winners

Sometimes brokers organize different draws between their customers (new and existing) offering different prizes to the winners, including cash prizes (in the form of bonuses) and travel among others. Each of these draws can differ significantly with respect to the conditions, prizes offered, how to participate, and how the winners are determined.

For example, some sweepstakes require the trader to open an account, verify it and deposit a certain amount of funds. Others require the trader to complete a certain amount and/or volume of trades. Winners are usually chosen at random from among the participants, although this depends on the draw. Prizes are awarded depending on the nature of the prizes, as they can be cash bonuses or even paid-for trips.

Additional Resources and Services

Sometimes brokers offer special promotions that consist of different resources and additional free services for customers who meet a number of requirements. For example, a broker can offer trading courses, ebooks, personal training, or other special benefits to new customers who open an account and deposit funds. Similar promotions also exist for existing customers who deposit additional funds or complete a certain volume of operations.

In this sense, there is a great variety of promotions of this type that offer all kinds of useful resources. For example, some brokers have programs that reward their clients with «points» for trading in the markets or other shares, which can be exchanged for cash bonuses, prizes, additional services such as those mentioned above, improvements in existing services, improved trading conditions and others.

We also have cases of brokers offering a free VPS service to clients who maintain a certain level of capital in their account and/or complete a certain volume of transactions per month.

Free Resources for the Trader

In order to get new customers and promote their brand, some brokers offer all kinds of free resources to the trader, which in some cases do not even require the trader to open an account with the company. These resources include trading courses, free ebooks, training, and more.

Categories
Beginners Forex Education Forex Basics

Forex Bonus Types and Scam Avoidance

When choosing a Forex broker, we look at many different aspects of their services, including available account types, deposit requirements, fees, and so on. While bonuses are not enough of a reason to choose a broker on their own, traders should know that a good bonus opportunity can provide several benefits. Unfortunately, some brokers advertise […]

When choosing a Forex broker, we look at many different aspects of their services, including available account types, deposit requirements, fees, and so on. While bonuses are not enough of a reason to choose a broker on their own, traders should know that a good bonus opportunity can provide several benefits. Unfortunately, some brokers advertise […]

When choosing a Forex broker, we look at many different aspects of their services, including available account types, deposit requirements, fees, and so on. While bonuses are not enough of a reason to choose a broker on their own, traders should know that a good bonus opportunity can provide several benefits. Unfortunately, some brokers advertise opportunities that seem amazing, when the bonuses are almost impossible to earn or withdraw realistically. Within this article, we will cover the various types of Forex bonuses and how to avoid being scammed. 

Types of Forex Bonuses

Deposit Bonus

One of the most common types of bonuses available is deposit bonuses, which add a certain bonus percentage based on the amount of one’s initial deposit. The exact amount varies by the broker and usually falls in a range from 25% to 100%, although we have seen higher offers in rare cases. For example, if you deposit $100 with a 50% deposit bonus, you should have $150 available in your trading account. 

Welcome Bonus

A Welcome Bonus is something that brokers offer to attract new clients; however, terms vary by brokers. Some offer a certain bonus amount (typically around $30 or so, but sometimes higher) for a trader to open an account without requiring that they make a real deposit. This is the best scenario for beginners and may help one to see if they are truly prepared to begin investing real money. Of course, the money must be used for trading, and bonus funds cannot be withdrawn. The other scenario works like a deposit bonus, where the Welcome Bonus is awarded if the trader meets an initial deposit requirement, or fulfills a set requirement when signing up, such as selecting a certain account type. 

No Deposit Bonus

This bonus works very much like the Welcome Bonus, except the broker never asks for an initial deposit. Traders can simply open an account and start trading with the bonus they are given, without risking anything or owing to the broker if the bonus funds are lost. Once you’ve used up all of the bonus funds, the brokerage would hope that you would then decide to make a real deposit into the account, but this is optional. 

Reload or Re-deposit Bonuses

These bonuses are more beneficial to existing traders who have deposited with the broker at least once before. It works very much like a regular deposit bonus by applying a certain percentage onto the deposit. In some cases, a broker may offer a different percentage than they would with the initial deposit, which allows traders to rack up bonus funds in larger quantities. 

Special Bonuses

These bonuses fall into more of a miscellaneous category and often require certain tasks to be performed on the website before being earned. For example, one might need to trade a certain number of lots to earn the bonus. In many cases, these bonuses are reserved for certain account types and usually focus on VIP accounts or other high-tier accounts. 

Avoiding Bonus Scams 

While there are many reputable brokers out there, traders need to be aware that scammers are among them. Throwing out unrealistic sounding bonuses to lure customers in is just one of many ways that an untrustworthy brokerage may try to trick potential clientele. Here are a few tips to avoid being scammed with Forex bonuses:

  1. Always read the terms and conditions in full, both for the broker in general and for each bonus opportunity outlined on their website. Write down any conditions or alarming facts that you find for reference.
  2. Check to see if there is a limit on the number of bonuses that can be earned. If a broker offers various deposit bonuses and other options, then chances are that traders will only be allowed to claim 1-3 of them, so you will need to choose the ones that will benefit you the most. 
  3. Check to see if certain bonuses are only available to certain account holders. Many brokers reserve the best options for VIP accounts or accounts that require the largest deposits. In some cases, micro/mini/cent accounts are not allowed to take part in any special bonuses, or their participation is severely limited. On the contrary, we have seen some special bonuses that are only offered to low-tier accounts. This is something that varies widely by the broker. 
  4. Look in the terms & conditions to see what needs to be done for the bonus to be withdrawn. Many brokers will require you to trade a certain number of lots. There are always limitations on Welcome and No-Deposit Bonuses as well that keep traders from simply withdrawing those free bonus funds into their bank account. You will need to trade so many lots, make a profit from a real deposit, deal with some type of profit limitation, or deal with other restrictions before brokers release these funds. 
  5. Check to see if there are any restrictions that will wipe out the bonus. For example, many brokers will not allow the trader to make a withdrawal until the bonus has been completely earned. Other times we see limitations on what leverage can be used when trading with bonus funds. 

Conclusion

Traders should always figure out their potential broker’s pros and cons before opening an account, and this decision should never be made based on a bonus opportunity alone. However, good bonus options offer several benefits, such as helping a beginner ease into trading without using their own funds, by simply providing one with extra money based on the amount they deposit, and so on.  Once you have identified which types of bonuses are available with a certain broker, always be sure to read through those terms and conditions to be sure that earning and withdrawing will be within possible means. Be sure to write down any conditions or rules related to the bonuses that you will be able to earn. 

Categories
Beginners Forex Education Forex Basics

The Best Forex Deposit Bonuses in 2020

Several different brokers offer deposit bonuses to clients as an incentive to open and fund a trading account through their company. This isn’t something that is always expected, but it does provide a perk that helps clients get more out of their initial deposit. Traders that only have a small amount to deposit benefit because […]

Several different brokers offer deposit bonuses to clients as an incentive to open and fund a trading account through their company. This isn’t something that is always expected, but it does provide a perk that helps clients get more out of their initial deposit. Traders that only have a small amount to deposit benefit because […]

Several different brokers offer deposit bonuses to clients as an incentive to open and fund a trading account through their company. This isn’t something that is always expected, but it does provide a perk that helps clients get more out of their initial deposit. Traders that only have a small amount to deposit benefit because the broker adds to their deposit and those that make large investments can earn thousands of dollars’ worth of bonus funds through these promotions. Some deposit bonuses are very small, while others are much more generous. We’ve provided the very best bonuses we could find for the summer of 2020 below.

CapitalStreetFX

In one of the most generous promotions we’ve seen, CapitalStreetFX is offering a 650% deposit bonus when you open a trading account with a $1,000 minimum deposit. Be sure to request this promotion from your client dashboard AFTER opening and funding your account, then reply to the acknowledgment email that the company sends to fully apply for the promotion.

Just2Trade

Just2Trade is offering a bonus of up to $2,000 until July 31st, 2020. The bonus amount starts at $50 on any deposit of up to $199, climbs to $100 on any deposit of $200 to $999, and then comes in amounts of $400, $750, and $1,000 before topping out at $2,000 on deposits of $10,000 or more. You’ll need to fill out an application to receive the bonus.

AETOS

AETOS is offering a Welcome Bonus of up to 20,000 AUD ($13,960 USD) to those that open an account, make a deposit, and achieve an outlined trading volume. The smallest bonus reward is on a 25-9,999 AUD deposit with a trading volume of 7.5 lots and the biggest reward is for deposits of 200,000 AUD or more with a trading volume of 4,000+ standard lots within 7 months.

Accuindex

Accuindex is offering a 50% deposit bonus when you open and fund a trading account with at least $250. The maximum bonus reward tops out at $4,000. Conditions surround withdrawals and the bonus is valid for 30 days from the date that it is applied.

VideForex

VideForex is rewarding any trader that opens an account with a deposit bonus from $250 up to an impressive $50,000. The bonus amount is based on the amount of your deposit, with a 20% bonus applied on $250 deposits, 50% applied on $1,000 deposits, and 100% applied on deposits of $3,000 or more. In order to claim the maximum bonus, you’ll need to deposit $50,000 into your trading account.

Xtreme Forex

Xtreme Forex is currently offering a 100% Credit Bonus that tops out at $20,000 that runs indefinitely. This bonus is only applied to new Standard accounts and requires an initial deposit of at least $100. The company does have special rules for withdrawals when a bonus is active on an account.

FX Primus

FX Primus has an ongoing promotion that applies a 100% deposit bonus on deposits of $500 or more for a limited time. Traders can also earn up to $4 cash back for every lot traded. The maximum bonus amount one can earn tops out at $10,000 on a $10,000 deposit. An end date for the promotion has not yet been announced.

*Although we’ve provided a basic outline of the promotions above, be sure to do thorough research on the broker’s website before opening a trading account or participating in any bonus offer. Brokers might apply other conditions regarding timeframes, withdrawals, or other matters that we have not discussed here.

Categories
Beginners Forex Education Forex Basics

What is a Forex Deposit Bonus?

There’s a lot to compare and consider once you start looking for a forex broker. Account types, fees, and funding methods are some of the most common items traders look for. Finding a broker that offers good bonuses and/or promotional opportunities is a big perk. Every broker has its own unique rules and conditions for […]

There’s a lot to compare and consider once you start looking for a forex broker. Account types, fees, and funding methods are some of the most common items traders look for. Finding a broker that offers good bonuses and/or promotional opportunities is a big perk. Every broker has its own unique rules and conditions for […]

There’s a lot to compare and consider once you start looking for a forex broker. Account types, fees, and funding methods are some of the most common items traders look for. Finding a broker that offers good bonuses and/or promotional opportunities is a big perk. Every broker has its own unique rules and conditions for any promotion that is offered, but most deposit bonuses work in the same way: the trader opens a live account through the brokerage and makes a deposit.

The deposit bonus is then applied as a certain percentage to the deposit that has been made. For example, if the broker is offering a 50% deposit bonus and you deposit $100, you would actually have $150 available in your trading account. Deposit bonuses can be very helpful to traders that don’t want to make a large deposit because they add to your account balance and can be used freely for trading. Here are a few quick facts about deposit bonuses:

-You must sign up for a live account and make a deposit before you receive the bonus unless the broker is offering a no-deposit bonus, which does not require a deposit.

-Most brokers will allow you to withdraw bonus funds or profits made once you reach a certain trading volume.

-Your deposit might need to be of a certain amount to qualify for the bonus. Always check to see if each deposit qualifies or if you need to meet a certain minimum for the bonus to be applied.

-Some bonuses are provided as soon as you open your account, while others are only credited with a certain amount of trading activity. Deposit and no-deposit bonuses are usually applied once the account has been opened, while rebates are applied later on.

While deposit bonuses are more common, some brokers offer no-deposit bonuses as well. This applies a certain balance to your account once you sign up for an account without requiring you to make a deposit. If you lose the entire bonus amount, you can simply walk away without owing the broker anything. This is sometimes labeled as a welcome bonus.

It’s important to read the terms and conditions for any bonus you want to receive before opening your account or making a deposit. Some brokers are very transparent, but others might have impossible requirements that keep you from ever being able to withdraw your bonus funds if you turn a profit. Some might allow you to open an account with $100, but only credit bonuses to those that deposit $500+. Other brokers require traders to reach out to one of their customer support agents within so many days of making their deposit in order for the bonus to be claimed. Conditions can vary widely, so this is why one should always be cautious and read the fine print.

You might be wondering why brokerages would offer free funds in the first place. The general idea is that traders will open accounts to take advantage of the promotion and would then continue to trade through the broker. A broker that offers a no-deposit bonus would hope that the trader would decide to deposit their own money after using up the bonus or making some profit from it.

Either way, these bonuses are good for the company and the trader alike. A word of warning, however – some scammers offer bonuses that seem too good to be true to convince traders to open an account with them. Getting a good bonus is always a perk, but you shouldn’t open an account with a broker for promotion alone. Always check out the company thoroughly and make sure that they offer attractive trading conditions, otherwise, the bonus won’t be worth it once you’ve paid out extra fees.

There are always conditions that require the funds to be used for trading, so don’t think that you can simply claim a no-deposit bonus, withdraw the cash, and walk away. You’ll usually need to achieve a certain trading volume to withdraw the funds, so if you manage to profit from the provided bonus, you will have the option to withdraw your profits once you meet the terms.

Everyone loves free stuff, and forex deposit/no-deposit bonuses are great perks. However, traders should always make sure a broker is legitimate with decent trading conditions no matter how good their perks seem. It’s also important to read the fine print to ensure that you know exactly what you need to do to qualify for any bonus and that you’ll be able to withdraw your funds eventually. Many beginners might lose their bonus funds trading, but these bonuses do offer one the chance to profit on the broker’s dime and to withdraw their cash once conditions are met.

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Forex Videos

Bonus Brokers Are For Jokers – Forex Bonus Debunked

https://youtu.be/jHTO0BEy4xs

https://youtu.be/jHTO0BEy4xs

Bonus Brokers Are For Jokers – Forex Bonus Debunked

The number of retail forex brokers is growing year on year. Currently, there are over 1300 of them out there, all vying for the business of the estimated 9.6 million online traders.
Just like the majority of food retailers who offer loss-leading products to get buyers into their stores, retail forex brokers know they have to offer incentives to get traders on their books. Typically, forex brokers will offer inducements such as sign-on bonuses, commission rebates, no deposit bonuses, and the offer of cash rewards when certain targets are hit by traders. Some also offer demo account trading competitions with prize money on offer to the most successful traders. And of course, all of these are subject to the company’s terms and conditions.


One of the most common types of inducements is a $25 – $50 account opening bonus, where new accounts are credited with $25 or $50 after an application has been accepted, and where traders can commence trading having not deposited any money, and where they get to keep any winnings on the account, suffer no losses, but they do not get to keep the $25 or $50 bonus. This is just a simple tool to offer free margin and get traders out of the starting blocks and up and running.


Another type of inducement looks – on the face of it – to be far more generous and goes something like this: the trader deposits funds of $10,000 and is offered a 10% cash bonus on successful opening and closing of 200 standard lots. This sounds great until you actually drill down a little more into the offer because 200 lots equate to approximately 2000 mini lot trades of $1 per pip, or 1000 of $2 per pip, which is fairly typical of new retail traders.
Therefore, if you traded 5 x $1 mini lots per day, it would take 400 days or over 13 months to turn over the equivalent of 200 lots at that rate! Coupled with that, some such brokers will have a clause that stipulates that there should not be a drawdown on the account of more than 20%. So, who is likely to ever see this bonus? Well, certainly none of the 70% of retail traders who statistically lose all of their deposited funds in the first six months. And of the other 30%, let’s say about 5% might be good enough to achieve the above criteria.

Because of the high turnover of retail traders, and the growing number of emerging brokers, there will always be similar offers from brokers going around to keep new traders coming onto their books, while the losers are going off. It’s a simple marketing ploy to try and mitigate client loss with new sign-ups.


But in real terms, the brokers are offering very little. Essentially, of the above examples, you do not get to keep the $25 or $50, and it means your trading leverage only allow you to trade a few cents per pip, and as for the $1000+ cash bonus, well it really is a commission or spread rebate in sheep’s clothing. But hey- it is advertised as a bonus, and if you can meet the criteria, it is certainly worth having. And so when we take out all these bells and whistles, what is left? Well, the following are the most important issues new traders should really be worrying about, and here are some questions that they should be asking their prospective broker:

Are they an ECN broker who passes trade orders on to third parties, or, will you be trading against the broker, which is what most spread betting firms do? Do they offer tight spreads and instant execution with low latency and low slippage? Do they charge a commission on top of their spreads? If yes, do these commissions, when added to the spread, equate to an average all-in spread of around $1 per pip for the major pairs, which is fairly typical of some of the better-known brokers? Do they offer customer support, which will respond immediately, and which is exactly what you would need in a crisis? You might also want to ask them who their liquidity providers are because the more there are, the better the liquidity the broker will have, and this will mean that these providers will have done their homework on the broker too. The number on thing that concerns us here at Forex.Academy is the enormous amount of turnover of retail traders, data from the US securities regulator for October shows that Interactive Brokers lost 30% or $5 million of retail FX funds in recent months, this can only mean that retail traders are losing money, fast.

Here at Forex.Academy, our message is clear. Learn how to be a professional trader, and ensure you are winning consistently. We have all the lessons to help you become the successful trader you deserve to be. And they are all freely available!