All You Need to Know about Forex Bonus
In this write-up, we will see some main points we need to know about Forex Bonus. So basically, Forex bonus are a particular type of promotion and benefits by brokers to introduce customers to the services offered by the broker, attract new customers, maintain high trading activity, promote new deposits, and many more. Giving bonuses is a tactic to fetch and attract new customers that most brokers use. After understanding the definition, let’s move forward,
Wanna know why Bonuses are mostly given?
Complete Registration and verification of accurate data on the broker’s website, Make the first deposit, Deposit with a certain amount, High trading activity. These all are the point that can be the reason for being awarded Bonuses.
After getting knowledge of why bonuses are given, see the requirements that need to be fulfilled if the trader wants to receive the bonus. These are some conditions by Brokers.
Limited helpful bonus life, the provision of trade credit increases existing facilities, Minimum required trading volume, The ability to withdraw only the profit from the trading bonus funds, but not the principal amount of the bonus.
One important thing, these bonuses have some advantages and disadvantages too. Do you want to know? Kindly continue reading,
Additional capital exceeds the profit potential, and without deposit bonus, traders can easily test the broker’s terms and conditions without spending their own money and without risk.
Difficult conditions to receive bonuses, The quantity of the no deposit bonus is often quite simple – $5 – $100, Excessive training due to the need to comply with loyalty program requirements.
Forex Bonus Classification
Forex Bonus consistently awarded according to the conditions, they are divided into three groups,
- Forex No Deposit Bonus – can be given without a deposit
- Forex Deposit Bonus – awarded for depositing a certain amount into your account
- Forex Welcome Bonus – designed for new customers and usually given on the first deposit.
After understanding and reading the basics of Forex Bonus, we will see what are the hurdles that we sometimes face because of the bonuses, why we should not take forex bonuses and what are the withdrawal issues we face,
Let’s say you deposit 1000 USD into a foreign currency account and receive a 200 USD bonus in return (see Day Trading with 1000 USD or less). While this will give you a trading capital of $1,200, you will not be able to withdraw that amount. While you may have $1,200 in your account if you withdraw $300 for emergency expenses, forex brokers are unlikely to allow that. Why? Because now the money is mixed with yours. You have a great interest in keeping your capital in the account because it protects yours.
What if you want to switch brokers, i.e., withdraw your money? The bonus you receive forces you to stay.
Usually, you need to trade $10,000 for every $1 of the bonus (read the fine print, bonus terms may vary). To make that $200 yours, you need to exchange $2,000,000 worth of currency. The conditions for Forex bonuses are different, but the point is that you have to trade a lot, no matter how it is structured. Some brokers allow withdrawals during the “accumulated bonus” phase. Still, you often lose the accumulated or bonus in proportion to the amount withdrawn (this is natural, but we had another problem). This tells us the following reason why you should not take bonuses from forex brokers. So, this was the little information about Forex Bonus for you.