How To Trade The FX Markets Using A No Deposit Forex Bonus
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A Forex no deposit bonus is the key to tackling the financial markets without investing one’s hard-earned money. No deposit bonus allow an investor to make a significant amount of money with virtually zero risks. So, how is a no deposit bonus better than any other forms of rewards?
Forex trading is a risky investment venture that is not intended for the faint of heart. Regardless of the millions of retail and institutional traders that occupy the Forex market, only a handful of traders finds success. Amateur traders have the option of demo trading that can help them to understand the risks of trading, but demo trading cannot replicate the real-life emotions and risks of live FX trading.
This is where a Forex no deposit bonus can come in handy for both amateurs as well as established FX traders. No deposit bonuses are immensely popular in the FX market, albeit, there are only a few brokers that offer such a facility for new accounts. Let us take a close look at how a no deposit bonus works, and what are the best no deposit Forex brokers currently available in the industry.
Why Do FX Brokers Offer A No Deposit Forex Bonus?
Bonuses are always dished out by brokers in return for better visibility in the retail trading market. Bonuses seek to attract new traders, which in turn helps a broker to earn more revenue and cater to a large group of traders. However, traditional deposit related bonuses involve the broker crediting a trading account with a percentage of the initial deposit, which can be anywhere from 5% up to 500% of the deposit amount. The significant difference between a deposit and a no-deposit bonus is that a deposit bonus requires an initial deposit, while a no-deposit typically does not require a deposit of any kind.
A broker uses its operating capital to fund a trading account with a no deposit bonus. In this type of bonus, it is the broker that bears all the risk, since traders using such a bonus will have no emotional ties to the bonus amount while trading. It is a common sight for traders to blow up their no deposit bonus Forex accounts within days of opening an account. Due to the nature of such bonuses, traders often place themselves into a gambling mindset to get the maximum amount of money within the shortest amount of time using the highest leverage.
Brokers are indeed aware of such gambling mentality and are betting on a trader to make further deposits to carry on trading. Brokers realize that once a trader starts trading the market, he will find a need to get back at the markets, and will do anything in his power to invest more and reclaim the lost money. Brokers are also aware that once a trader feels comfortable with a brokerage firm, it is natural for them to make a deposit and continue trading with the broker, rather than moving on to another company. This is the main reason why some Forex brokers offer attractive no deposit bonuses, even if it drains their operating capital by a fair margin.
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How To Get A Forex No Deposit Bonus & Use It To Your Advantage
Not all brokers advertise a no deposit bonus due to the obvious reasons, but there are a few mainstream brokers that do offer a Forex no deposit bonus on certain conditions. No deposit bonuses start from $5, and some of the maximum no deposit bonus offered include up to $500. However, larger bonuses are relatively rare. Most branded FX brokers offer a no deposit bonus to the tune of $25 or $100. Although traders might consider this amount to be smaller, it is better than opening a demo account or risking a similar amount in the markets without any prior experience.
Once you receive a no deposit bonus, never consider it as a means to untold riches. Instead, let go of your gambling mentality and treat the money as your own. Once you start making some profits and start adding on to your equity, you will feel more connected to the bonus, which can prevent you from making any rash decisions. Always trade the bonus money within the confines of your strategies, and never deviate from your money management principles just because you have no risk associated with account bonus.
Some brokers will allow you to withdraw your no deposit bonus along with its profits, provided you can satisfy the broker’s bonus terms and conditions. Therefore, with a successful strategy, you can convert your small initial bonus into a steady income stream without any risk whatsoever. It is crucial that you should have a good understanding of the ground rules of the game, and be aware of the several terms and conditions before receiving a no deposit bonus.
What Are The General Trading Conditions Related To A No Deposit Bonus?
No Deposit bonuses are restricted to one person per household/IP address. If a trader is suspected to have received multiple bonuses, such traders and IP addresses will be banned, and all funds (including bonuses and profits) will be reverted to the broker’s account.
No Deposit bonuses are only offered to certain geographic locations, and it is up to the broker’s discretion to either approve or deny bonus claims for a trading account.
Traders should have a verified trading account to be eligible for a no deposit bonus.
All profits made using a no deposit bonus may or may not be withdrawn, and is dependent on a broker’s policy on no deposit bonuses. Some brokers require traders to make a deposit before they can withdraw the profits made from a no deposit bonus, while others only stipulate a minimum number of lots to be transacted before the funds are open for withdrawal.
Advantages & Disadvantages Of Broker Sponsored Funding
No deposit bonuses allow a trader to enter the market without facing any downside risk. Mistakes in trading are also forgivable, as the lack or real money on the line avoids any emotional disturbance or psychological imbalance. Therefore, traders are quick to make decisions, which can work either for or against a trader’s strategy. Sponsored funding also helps newbie traders to learn the mechanics of a market without the aid of a demo account.
Due to the lack of an emotional connection with a no deposit bonus, inexperienced traders can quickly resort to gambling, and it will be a dangerous tendency to acquire for amateur traders. No deposit bonuses also have the most stringent set of conditions that prevent traders from withdrawing their profits even after trading for a prolonged period. Any erroneous data related to IP address sharing or opening multiple accounts through a shared internet connection can ban the entire IP address and its users from opening or operating a trading account, as most brokers put a strict cap on the no deposit bonuses provided to their traders.
Finding The Best No Deposit Forex Brokers
Browse through the following list of no deposit Forex brokers to get a fair idea about the most established brokers that offer a no deposit bonus. Remember that most brokers have severe trading conditions associated with their no deposit Forex bonus; hence, go through each broker carefully before choosing your preferred broker.