Stock Indices Trading Accounts
Indices Trading Accounts Examples
In recent years retail indices trading has grown hugely in popularity and demand for different types of stock indices accounts has grown. There are many different stock indices account types available to any indices trader who wants to invest in the online stock indices market - Indices Trading Account Explanation.
The stock indices market is a highly indices leveraged market for speculating on price valuations. Traders can purchase big amounts of indices trading units using leverage - Indices Trading Leverage is what makes indices trading attractive to many online traders - with indices trading leverage a trader can make more profits or losses because they use less of their capital & borrow the rest.
There are different types of stock indices accounts available to help investors better manage their indices account capital as well as their indices trade transactions.
How a Real Indices Account Looks Like
It is therefore important that the traders consider what they want to get out of their indices trading, before deciding on the stock indices account type to open.
Shown Below is a comparison of the two types of stock indices accounts commonly used to trade indices. The stock indices account types review below explains the different features of each of the types of indices accounts.
1. Standard Indices Trading Accounts Explained
Indices Account Explanation - Standard Stock Indices Account. A Standard Indices Account is denominated in US Dollars and indices trade transactions are placed using standard lots. One lot is also known as one contract. Minimum opening capital - at least $10,000 USD.
1 contract refers to the minimum size of a single indices trade transaction. This indices account option is the most suitable for traders with enough capital to invest in stock indices trading - this indices account option requires $10,000 & $50,000 dollars as starting capital, for this standard stock indices account the trader will not be undercapitalized and with good indices trading money management rules and indices money management strategies, this standard indices account option has the best chance for profitability because it is not undercapitalized. Under capitalization is what makes most traders in indices trading not profitable.
It is not recommended to open a standard indices account unless you have an account balance of at between $10,000 minimum and $50,000.
Professional Money Managers recommend $50,000 Dollars minimum to open this standard stock indices account & only opening trades with only 2% of the trading capital you have in your stock indices account. However, most online indices brokers will still open this standard stock indices account for you if you have more than $10,000.
With indices trading leverage of 100:1, you will borrow from your indices broker (with stock indices leverage of 100:1, your indices broker gives you $100 dollars for every $1 dollar that you have in your stock indices account, therefore if you have $1,000, the broker will give you $100 dollars of stock indices leverage for every $1 dollar you have, meaning after stock indices leverage you will have $1,000*100=$100,000 which you can then use to trade indices).
2. Micro Indices Account Explained
Indices Account Explanation - Micro Indices Trading Account. Micro Indices Trading Accounts use lot sizes of only equivalent one-hundredth that of a indices trading standard lot. These Micro stock indices accounts are often appropriate for traders without a lot of indices capital & can sometimes be opened with only a $5 minimum balance.
This Micro indices account option allows the trader to open trades in micro lots. 1 indices trading micro lot is one-tenth of a indices trading mini lot and one-hundredth of a indices trading standard lot.
This Micro indices account option is generally best suited for indices account equity balances that are between $1,000 and $5,000
In indices trading, one indices trading standard lot is the standard transaction minimum of indices instrument traded in the stock indices trading market. But many indices brokers offer fractions of this indices trading standard lot to enable more retail traders to access the stock indices trading market. Being able to offer indices trading micro lots reduces the minimum indices trade transaction size thus giving the beginners and also those traders without a lot of indices capital to begin trading and get a feel of the stock indices trading market without investing a lot of indices trading capital.
There are learn indices online tutorials that a trader can read even before opening a real stock indices account, and to get extra practice in indices trading before opening a real indices account a beginner trader should open a practice Indices demo trading practice account with a broker - so as to practice placing indices trade transactions before opening a real stock indices account & investing with real money.
During the indices trading training period using the stock indices trading practice account, the beginner indices trader will learn the key factors needed to succeed in indices trading such as: indices trading education, indices trading money management, indices trading plan & indices trading systems.
The types of trading strategies used and the skills required for any of these 2 stock indices accounts are essentially the same - those indices trading skills and trading strategies required for the Standard indices account or Micro indices account are the same the only difference to be adjusted are the indices trading money management rules for each stock indices account type.
