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Thread: What type of account to choose?

  1. #1
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    What type of account to choose?

    Beginner traders often have questions about types of accounts – what type to choose, with fixed or dynamic spread? Roboforex company has 2 types of cents accounts: fix-cent (with fixed spread) and pro-cent (with dynamic spread). Know more about it on the company’s website: http://www.roboforex.com/trade-condi...account-types/

    Fix-Cent

    Features: Fixed spread, 4 digits after decimal point, «Instant Execution» mode.

    Instant Execution allows to execute orders immediately. This type of execution allows to trade with fixed prices what means that order will be either executed by indicated prices or rejected (trader will get requote). This type of order is useful for traders who need certain prices for execution and don’t want to have «slippages» while execution. Disadvantage of this type of order: trader will be unable to enter his position in case of aggressive price action – he/she will get requotes in most trades. That’s why this type of account has 4 digits after decimal point (to avoid numerous requotes). Such accounts are convenient for beginner traders. But you should remember that if there are no requotes – there is no instant execution.

    Pro-Cent

    Features: Dynamic spread, 5 digits after decimal point, «Market Execution» mode.

    Market execution mode allows trader to have nearest best prices for his trade. Order will automatically match with best price for the given moment. This type of execution is used also on futures and stocks exchanges and other marketplaces. Traders, who traded before on «Instant Execution» will note that execution time will increase with «Market Execution» more and quotes will change much more rapidly (because of additional digit after decimal point). 10 pips on «Pro-cent» wil be equal to 1 pip in «Fix-Cent» account. 5 digits are better for automatic execution when trader uses robots.
    Now, when we know differences among «Pro-Cent» and «Fix-Cent» accounts, let’s see some documentation: http://www.roboforex.com/trading-accounts/documents/

    For now, we can see release of trading conditions from August 13, 2013.

    Let’s go to «General provisions», I advice to pay some attention to point 6.6

    6.6. For accounts Fix-Cent, Fix-Standard and Fix-ECN spread specified in the contract specifications, is a fixed, but can be increased from 22:00 to 06:00 server time.
    Also, points 7.5 and 7.6

    7.5 In process of Instant Execution of Client’s order, the price quoted in the order is compared with the current price. In case the current price differs from the price quoted in the order, a new price will be proposed with comment “Requote”. In case Client does not accept the new price within 3 seconds, it will be considered that the transaction is cancelled.
    7.6 In case of Market Execution, execution of Client’s order will be made at the current price at the moment of order execution.
    Points 12.1.1 and 12.3.1.

    12.1.1. Stop Out value makes 10 % for Fix-Cent and Pro-Cent accounts on Metatrader 4 and Metatrader 5 platforms.
    12.3.1. Margin Call value makes 40% for Fix-Cent and Pro-Cent accounts on MetaTrader 4 and Metatrader 5
    Point 6.6 allows to increase spread. It means that we are dealing with conditionally fixed spread. Point 7.5 guarantees certain price for a trader in a period no more than 3 seconds. Point 7.6 indicates that orders are executed by market price, therefore some slippage may occur. Points 12.1.1 and 12.3.1 indicate that Stop Out and Margin Call levels are equal for both types of accounts.
    Now, when you know those nuances from trading conditions, let’s see how these conditions are realized in actual trading process. To accomplish this goal, we will go to historical tick charts of EURUSD since 30.09.2013 till 4.10.2013 (GMT+3) for the whole week.

    Fix-Cent

    Spread was as stable as 2 pips without any changes. Probably, this week was pretty quiet and there were no significant news or drivers for the market.

    Pro-Cent

    Let’s dig deep into details and make small research.
    Before we start, I will remind once again that 2-pips spread on Fix-Cent means 20-pips spread on Pro-Cent.
    I’ve divided one day on two sessions: Day session (6:00 – 22:00) and Night session (22:00 – 6:00), timezone is GMT + 3. Picture 1 shows lowest, average and highest values of spread.


    Picture 1. Spread value distribution on Pro-cent accounts.

    If we look at highest values, we may think that Pro-Cent accounts have wider spread, than Fix-Cent accounts, but it isn’t so. Ticks with spread more than 20 pips are less than other ticks (with spread lower than 20 pips). Let’s go through some cases.

    Case № 1

    Monday night we have seen the highest spread for the period, highest value is 92 pips. It’s worth mentioning that highest spread occurred before 1:15 (Night session), then values were no less than 20 pips. We can see it on Picture 2.

    Pic. 2. Spread value on Pro-Cent accounts

    [свернуть]


    Case № 2

    During news announcements, in some cases, spread is widening and achieves highest levels for the day. Let’s take one situation from 1.09.2013. There was economic data release. As we see, at 17:00 (terminal time) during USD ISD Manufactirung and USD ISM Prices Paid release, we have seen increased spread. Picture 3 shows spread values between 16:59 and 17:00:01 (highest values), then spread was decreased and 10 seconds after it decreases to 20 pips.

    Pic. 3. Spread value on Pro-Cent accounts

    [свернуть]


    The rest of the time period spread was lower than 20 pips. We can see it clearly on Picture 4, that shows value of spread of the whole day.

    Pic. 4. Spread value on Pro-Cent accounts during news announcement release

    [свернуть]


    Now, when you’ve gone through all nuances, we can make some conclusions.

    Fix-Cent accounts are more suitable for traders, who trade during high volatile market conditions (during news announcements for example) because spread there is fixed. But also, their orders can be rejected due to slippage (they will get requotes). Also, this type of accounts will be suitable for those who trades during the opening and the closing of the week (wide spreads occur during those periods). Fix-Cents accounts have wider spread than Pro-Cent. That’s why those trades who avoid news announcements and scalpers should better trade using Pro-cent accounts despite possible slippage. But be aware of news announcements time!

    I thinks, that analysis in this thread will help beginner trader make choice due to personal trading style.

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    Last edited by RoboForex Trader; 11-04-2013 at 03:26 PM.

  2. #1841
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    For beginners I suggest that they use the cent account, cause through the cent account we can learn how to trade using real money which will help us understand this business faster through the cent account 10$ can be a great capital to trade with that's why cent account is the best account for a newbie, until you understand this business continue to use a cent account if you are a newbie.

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  3. #1842
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    When having small trading capital cent account will be the best because cent account work very well even with small trading capital but if you have big capital you don't want to use cent account to trade even now most beginners prefer to use a standard account rather than using cent account to trade because.

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  4. #1843
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    Quote Originally Posted by jiji View Post
    When having small trading capital cent account will be the best because cent account work very well even with small trading capital but if you have big capital you don't want to use cent account to trade even now most beginners prefer to use a standard account rather than using cent account to trade because.
    yes, i chose cents account, pro, and this is a good account type to start trading with low capital, and also good leverage here with 1 : 500, that is good to get enough margin to sustain the position, and now, this chance is in front of us and we have to take it with seriously, that will become the steps for us to get the success, and also with bonuses from forum, that become a great thing as our real money for trading ,

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  5. #1844
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    I always choose pro standard dollars account of roboforex. I do not understand other account functions because I join this business previous year and have very limited knowledge about it. I Choose only this account for my deposit but I also like cent account because if our behavior is like greedy then cent account is really good for us and its we can easily manage it with greed.

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  6. #1845
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    in start of days i was here with fix standard account that was choosen because that was easy no dynamic spread, but after some time i start to do scalp also and in scalping it was necessary to use some small spread so i use pro standard account and will use it forever, hope you also will join this account, some time depend on capital also

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  7. #1846
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    It is a good post about different type of account and every trader must have knowledge in advance before enter in trading once i open cent account so a small flooting is also look like big floting after that i never open same type account so it is good and beneficial for us to make safe account by having all the knowledge .

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  8. #1847
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    We can choose to trade with any trading account of our choice, but before doing so we need to learn from the demo account and understand how to trade forex before we should choose to trade with any account of our choice, forex beginners it's strongly advice that they start with the cent account because this account is more safe to trade with.

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  9. #1848
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    Quote Originally Posted by freebird View Post
    We can choose to trade with any trading account of our choice, but before doing so we need to learn from the demo account and understand how to trade forex before we should choose to trade with any account of our choice, forex beginners it's strongly advice that they start with the cent account because this account is more safe to trade with.
    Trading account to be chosen in here will not be that much of an importance. What important is only how you will be trading and how you will make the money with them. We need to understand that forex trading is difficult because we always need to watch a lot of factors in the market and we need to stay neutral for most of the time to make rational decision.

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  10. #1849
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    Quote Originally Posted by sekiryutei View Post
    Trading account to be chosen in here will not be that much of an importance. What important is only how you will be trading and how you will make the money with them. We need to understand that forex trading is difficult because we always need to watch a lot of factors in the market and we need to stay neutral for most of the time to make rational decision.
    No it will be due to I see it as something that has to do with stage by stage, due to when one is new to the market, the account such person has to choose will have to be the one that has no risk and that is the demo trading account, then after that one has to move to the cent account, that is how the learning is supposed to be, so it is important to know the account to be selected.

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  11. #1850
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    A new trade should be trading with a cent account trading with a cent account lower the risk in trading because you can trade with low lot and leverage so the cent account should be the account you should be trading with if you are new in trading forex but after some time you can choose other trading account. Cause I noticed that we can open all trading account with same profile with roboforex.

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