Forex Deposit Bonus 2021: All You Need to Know About Forex Deposit Bonus and How Does It Work?
Forex Deposit Bonus 2021: All You Need to Know About Forex Deposit Bonus and How Does It Work?
In recent years, the forex market is gradually beginning to face the retail trader, which allows the latter to feel much more comfortable in the face of the power of the world's financial structures. As a consequence, trading is becoming much easier for more and more people, and risks are decreasing.
Why does it happen? The answer is simple - the fierce competition of dealing desks, i.e. non-banking institutions, providing access to trading and services of margin trading on the Forex market, for attracting as many successful traders as possible and, consequently, for getting more profit. And the winner of this competition is an ordinary trader, like yourself. Traders get a wide choice of different brokerage companies, which have better trading conditions, choice of terminals, a lot of valuable and more truthful information about the forex market, the best training materials, more and more perfect programs, and expert advisors which can not only provide signals but also trade automatically. And what is the most interesting, forex brokers offer their clients to take part in various promotions, for example, to get forex bonuses. Bonuses are very popular among traders, as with their help it is possible to receive additional profit, and even to earn, without investing any funds.
So, in this article, we will discover how the forex bonus works, will learn the different types of bonuses, as well as will discuss how to choose the best forex trading deposit bonus.
How Does a Forex Deposit Bonus Work?
A bonus is a sum of money that a company credits to your account to reduce risk and increase potential profits. After all, the less working capital, the less room for maneuver, the right to make a mistake, and, as a consequence, the greater the risk. The bonus is not a loan or credit. In case of its loss, the trader does not have to reimburse this sum and will not owe the broker. At forex brokers, the amount of offered bonus usually depends on the amount of the client's investment and the conditions of a trading platform chosen. It's also worth noting that in most cases the bonus is super difficult to be cashed out. It is not a monetary gift, but an assistance tool. In most cases, only profits can be withdrawn from the account.
The broker is not your good relative and does not help without a reason. Almost any bonus must be turned over by trading volume. As long as you do not fulfill this condition, you will not be able to withdraw your profit. In fact, this is not a problem at all. Many people just confuse turnover with profit. The bonus should be turned over by the trading volume. Trading volume is the total sum of all your trades, regardless of the result. For example, you opened three trades of $100 each. Two of them brought you $80 in profit, and on the third, you lost. Your profit was $60 (160-100). But the volume is equal to $300. It is also worth knowing that brokerage companies have different requirements for bonus turnover.
What Are the Different Types of Forex Bonuses?
Each high-profile brokerage company has a special team of marketers dedicated to the development of bonus offers. As a result of many years of specialists' work, different bonuses have been developed. Among the most popular ones we can name the following:
- forex trading deposit bonus, i.e. bonuses for funding the trader's account. Such bonuses are given when a trader replenishes his account with real money. The amount of bonus of each company is different: 5%, 10%, 25%, 40% and even 100% of the deposited amount. Bonus funds are usually credited for the first and all subsequent deposits, and their size often depends on the conditions of monetization (cashing out). As a rule, a trader must perform a certain amount of trading transactions to monetize the bonus. For some companies, these conditions are quite easy to meet, for others - very difficult.
Such deposit bonuses are often used by traders as additional means to increase their income because if these funds are skillfully managed, this is an additional 5 - 40% of profit to the deposit. However, in this case, experienced traders consider it wrong to chase the size of the bonus, and advise to choose such a bonus and such terms of its receipt, which will fit your trading style - because the bonus is still necessary to turn over. Also, in some situations, such additional funds may save the trader's account in the event of heavy drawdowns. Some companies even offer a "saving bonus".
- no deposit forex bonuses are bonuses that are credited to the trader upon passing simple registration procedures and do not require any deposit to the account (hence the name - no deposit bonuses). Such bonus is issued only once. The amount of the bonus is usually between US$5-100. Profits gained from its use can be withdrawn (cashed), and under certain conditions, you can even withdraw the no deposit bonus. These forex bonuses may be called differently by different brokers: free forex bonus, registration forex bonus, welcome bonus, free forex deposit, etc.
Those no deposit forex bonuses have become extremely popular nowadays and among other things, it is one of the most popular ways to get start-up capital for new traders: people are afraid of losing their money, and here they have nothing to lose. If a trader loses this bonus, he does not return anything to anyone. And the pluses here, in contrast to the demo account are huge: firstly, there is a psychological component of real trading, and secondly, from the real account you can withdraw the profit. Some dealing desks may make available such types of accounts as non-deposit forex accounts specifically for the "free trading". Usually, such accounts have the same properties as live trading accounts.
It is worth emphasizing that the no deposit forex bonus made a real revolution in the Forex market, transforming it from high-risk trading to a completely risk-free one. Having received the no deposit forex bonus, the trader can even lose it completely and he does not risk anything! At the same time, it is possible to make a decent profit.
- a gift bonus is a reward for making a deposit, which is paid on some occasion: the broker's birthday, New Year, Thanksgiving, and so on. In this way, the management is trying to increase the cash turnover during the lull, which is typical for weekends.
- risk-free trades - forex bonuses of this type have one very interesting feature: the broker compensates the money back if the order turns out to be unprofitable.
Remember: no matter how attractive forex trading deposit bonuses offered by brokers may be, you should not choose a broker based solely on the bonuses offered. You, first of all, should assess the efficiency of deposit/withdrawal funds, the quality of technical support, the company's experience in the market, the availability of real reviews about the company. And bonuses... can be a pleasant addition.
Forex Broker With A Bonus On Your Deposit
As you can see, the market is saturated with various bonus offers and every trader can choose a suitable one for himself. Thanks to the presence of bonuses, it is possible to try your hand at the forex market, even without investing significant funds.
First of all, forex bonuses are interesting to beginning traders, but skilled traders also with pleasure use them - for example, getting the additional funds due to a considerable quantity of trades. Bonuses give traders additional possibilities for getting profit on the market. It's important to carefully read the terms and conditions of bonus programs and decide which bonus is right for you.
As we have mentioned, brokers offer bonuses to attract new clients.
There is nothing wrong with that, if a company uses the advertising budget or the company's own funds for this purpose, that is, the action is backed by real money. And it's quite another matter if the company gives an unfunded bonus, which creates a cash gap, i.e. the funds are actually less than the obligations to the clients, in other words, a financial bubble is formed.
When choosing a reliable broker, you should not blindly trust advertisements. Companies that operate in a transparent manner, for which the sources of income are commissions and the advertising budget is limited, will not be able to give a bonus of 200% on the deposit, because this money will have to be given to the client one day.
And vice versa, shady companies that offer 200% bonuses and have endless promotions, are interested in the client losing his money by interfering in trading and using non-market quotes. In the future, for the money lost by the clients, they will pay for new campaigns.
Consequently, a trader, especially a beginner, should be extremely cautious about any forex bonuses as it is one of the main advertising tools that can be really confusing and misleading.
How to Choose a Good Forex Trading Deposit Bonus
Speaking about the best forex bonuses it may be not that easy to find any helpful information on the Internet. So, it becomes quite a challenge to find out which bonus offer is okay and which one is a trap. Now we will define some important aspects to pay attention to while choosing the best bonus forex broker can offer.
First off, (some may call it trivial) the most essential thing to do is to choose a reputable broker. Yes, we have talked about that many times, but without a decent broker, nothing else matters because you may be offered a $1000 bonus on top of your $500 deposit and the company vanishes on the next day. Now it makes sense to pay more attention, right?
Well, it is advisable to start choosing a forex broker by studying the reviews and opinions of other clients. It is best to study not only the forum of the company itself but also portals and forums devoted to trading, so as not to doubt the truthfulness of the reviews. Traders usually look for the following information in reviews:
- Whether the company keeps traders' deposits reliably, whether there were cases of groundless debiting of funds?
- How quickly and what methods are used for deposits/withdrawals?
- Are there non-market quotes, controversial closing of positions, lack of liquidity (a trader cannot close a transaction until the entire deposit is burned out)?
- Is the server that processes orders set up properly? It is especially important for robotized trading, where any error can "knock out" the settings of the trading robot.
After selecting several best brokers on the basis of reviews, the next stage of acquaintance with the trading begins registration on the broker`s website. Good intermediaries in the registration process necessarily verify the email and phone number of the client, "make" them set a long password. It is a pledge of account security. The client`s cabinet must be convenient and understandable, and during working hours the technical support must quickly answer the questions.
Next, the choice of a forex broker must depend on the company's trading conditions: preference should be given to those whose quotes are closest to the market average, the swaps and commissions are minimal, and the servers work quickly and reliably.
Secondly, it's time to choose the best type of bonus. Of course, the selection is to be based on your personal needs. For example, no deposit forex bonus will perfectly suit beginners who want to try their hand at the market but have limited available funds or are not yet confident in their trading system. Or traders who want to get acquainted with the company's trading conditions by testing them with bonus funds before investing their own.
Forex trading deposit bonus is suitable for traders who place a lot of positions every day, not just a couple of long-term trades. With the help of a high trading volume bonus funds will be easily turned over and will become a part of the trader`s fund fully. Additionally, this type of bonus will be useful if you want to trade instruments with a high margin - additional funds will give you such an opportunity.
Of course, there is a practical benefit from the received bonus, although we have to mention that its value is pretty exaggerated. Achieving significant financial results unlikely to succeed, even if the bonus amount is more than $100. But, if you are inclined to undergo some forex training, trading with money from which you can make a real profit, see the real level of quality of execution of orders on a real account of the broker, choose the path of professional trading and turn earnings on forex, in your main income program then forex trading deposit bonus is created for you.
Perhaps a hundred other dollars presented by a brokerage company as a forex bonus will not only open up the fascinating world of trading for you but also help you significantly shorten the way to significant profits.