The title of this article might be a little bit surprising to new traders. However, those who have a little knowledge about the financial industry know the importance of this trading article. There are many trading financial instruments, and every trader is different. If you try to open a trading account with different brokers, you will be given different types of account to trade with. Based on your trading style and system, you need to select your brokerage firm. For instance, if you trade the lower time frame, then you have to be precise about the spread offered in your trading account. For instance, many brokers don’t allow traders to scalp the market and some don’t even allow hedging. So if your trading system is based on lower time frame, then make sure that you are trading with a high-quality broker which support scalping.
Longer time-frame trader
The longer time-frame trader is often considered to be the best kind of trader. They are always concerned about their risk factors and they know that losing is just a part of their trading career. Being a new trader, you need to find the perfect trading system for you. If you prefer higher time frame trading then the market spread will not be a big problem for you. You need to consider the rollover charge and swap on that account. Being a long timeframe trader it’s obvious that you will have to keep your trades running for longer than a day, possibly longer than weeks. So if you don’t consider the rollover charge and commission, then you will end up paying a huge amount of money in the long run.
Trading environment
Without having a high-class trading environment it will be nearly impossible for you to make money. You need to have a high-quality spread betting account where all the trades will be executed without any requotes. In other words, you need to avoid the market making broker. However, many market making brokers will also have Pro STP account where the trades will be directly executed without any third party. Most reputed brokers are using Pro STP technology to carry out their trades so that the client’s orders are filled instantly. Being a new trader, you might not know much about the different types of brokerage firm. If you do some online research then everything will be crystal clear to you. Learn more about the market structure and the brokerage firm to get the best possible trading environment.
Do some online research
People are so fascinated with the trading industry that they hardly give any thought to choosing their brokerage firm. Novice traders especially are falling for the different types of bonus offered by retail brokers. But if you don’t learn how to trade with rational logic than having access to million dollar trading account will not help you. You have to do extensive online research to find the best trading style for you. Everyone starts learning with the technical section, but deposit a decent amount of money into the live trading account. Instead of trading the market with your real money, it’s better to trade with a demo account to develop a balanced trading system.
There is no other alternative other than learning the art of trading. You might trade based on emotion but at the end of the day, you will lose a big amount of money. If possible, try to learn from the professional traders. However, finding an experienced trader in today’s world is difficult, since only 5% of the traders are able to make money on a regular basis. Never depend on other people, but rather try to do things to become a better trader.
The retail traders often don’t know the fundamental differences between trading accounts. If you scalp the market, you need to have lighting fast trade execution and for this, you must trade with a DMA broker. On the other hand, if you are trading the longer time frame, it’s better to trade in a swap free trading account. Therefore, you have to pick your trading account based on your individual trading needs.
