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