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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. #1871
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    Quote Originally Posted by Sylvertee View Post
    It is not sign of success too, but traders have to choose the correct account type, as this will make the trading operation to be better with the trading strategy of traders. I like to trade with the account that has low spread and the ones that are not working with fixed spread, so that i will know how the market is fully operating at that time.
    There are many account types in the market, but i am sure that the success of any trader might be linked to the account type at times, and we should not be afraid to discuss about this. I do not like the fixed spread account too, i love the ECN better, but when the lower account with floating spread has better advantage, i will go for it.

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  3. #1872
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    I can choose any account type to trade at anytime because I think a trader with a better experience and knowledge of trading forex can use and manage any trading account well at anytime, the only account and experience traders won't want to trade with will be the cent account.

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  4. #1873
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    We can use any type of account in which roboforex facilities us. roboforex is good broker so if I choose a account type then its a cent account because its good for small investors. When we trade in cent account then we can control our greed easily. We can open big lot size in it because its a cent account. The other accounts type are also good but I like only the cent and pro standard account of roboforex.

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  5. #1874
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    I think all accounts are good as long as you can trade, but for those who needs more knowledge who has no skills yet, they need to develop their trading skills and understand the business so they need to invest first in the demo account for them to be able to get to understand the market. That way it is a stage by stage and learning after learning.

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  6. #1875
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    Quote Originally Posted by MIGHTYRAMESH View Post
    It does not matter which account we chose, what is important is how well we learn first. Account type does not bring profits and just knowledge can do this thing. I think that forex is very hard business mainly because all traders can not avoid greed, emotions and fear which is must for success.
    Well I think it matters when you are new in forex trading, it matters that we first practice in the demo account because it's risk free, so before we should trade in standard account we should choose to trade with cent account because the cent account is also low risky we can learn more in this account and develop more strategy before trading with a standard account.

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  7. #1876
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    i have several pro cents for trading and still use them till now, this is a good account type which give us more chances as the steps for bigger levels in the future, the reasons here that i still use low capital for trading and also the bonuses from forum too, and so with pro cents, i can get enough margin to sustain my orders with good leverage . and also now, roboforex give us new features, this is wallet and this is really helpful to save some profit and we can continue trading without any worry

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  8. #1877
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    A suggest that beginner should trade with the cent account and get to understand how to trade forex well before they should switch account to a more standard account, if you are new don't be in hurry to make money spend your time in learning how to trade forex and understand the market very before you become confidence to trade.

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  9. #1878
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    Quote Originally Posted by Sylvertee View Post
    It is not sign of success too, but traders have to choose the correct account type, as this will make the trading operation to be better with the trading strategy of traders. I like to trade with the account that has low spread and the ones that are not working with fixed spread, so that i will know how the market is fully operating at that time.
    I also see reasons with you because a trader who is making use of the standard account and making use of it the right way means that they have what it takes and therefore they can get a more better trades with good returns, but the traders who thus have got little or not skills, will often need to keep to the cent account till they succeed there and have confident with trading.

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  10. #1879
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    I am making use of the pro standard account and it works just better for me, I see forex trading as a business though that when you have given the right time in learning you should succeed. After using the demo I made use of the cent account and not on the pro standard account and it has been so much helpful to me and has made me see things differently.

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  11. #1880
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    Quote Originally Posted by D'mastermind View Post
    I am making use of the pro standard account and it works just better for me, I see forex trading as a business though that when you have given the right time in learning you should succeed. After using the demo I made use of the cent account and not on the pro standard account and it has been so much helpful to me and has made me see things differently.
    There are many accounts with Roboforex and one can chose an account as per his needs. Some people chose the fix cent account where spreads are fixed and some chose pro cent account where spreads are dynamic. I am working with Pro cent account of Roboforex. i think all accounts here are good and have great features for better trading.

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