As part of forex trading, exploring forex bonuses is certainly useful. This article will not discuss how to make money from forex bonuses, but rather how to choose the best forex bonus when you make a deposit.
Understanding the Best Trading Bonuses
You may have seen so many sparkling forex brokers advertisements for mouth-watering bonuses as high as 30%, 50%, 100%, or even 200%!
The higher the bonus offered, the more attractive it is for traders. However, is the offer realistic?
In order to avoid the fraudulent practices of scam brokers who only use bonus offers as baits, pay attention to the following steps when choosing the best forex bonus:
Step 1 - Find a Good Broker
It's not easy, but it's not too difficult either. If you don't know how to do it, you can read our guide here. The rule of thumb in choosing a broker is not to pick solely on the bonuses! Choose a broker with the best trading terms and conditions that suits your needs.
Step 2 - Study the Bonus Terms
Once you choose a broker, make sure they offer bonuses before you make a deposit. Don't worry if the website doesn't mention any bonuses, you can send an email to their customer service or ask the live chat about their bonus offerings.
Please note that you must be able to withdraw funds from your trading account. So in this case, check the bonus terms carefully!
Some bonus programs usually limit or even restrict withdrawals for a certain period. If you feel that the conditions imposed are too burdensome, then you should choose another forex bonus with easier and more reasonable conditions.
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Step 3 - Consider Your Trading Volume
Forex deposit bonuses are one way to get compensation for spreads and commission fees. This is why forex bonuses are usually adjusted on the transaction volume. If you have been trading all this while, check how much volume you trade on average per month. Take 80% of that and look for bonus offers that require lower volumes than that:
Example:
- Your average trading is 7.5 lots per month.
- Your account balance is 1500 USD.
- That means in 6 months, you can afford to trade as much as 7.5 x 6 x 80% = 36 lots
Say you have 3 bonus offers with the following volume terms:
- Broker A - 50% Bonus (750 USD) requires 200 lots in 6 months
- Broker B - 100% Bonus (1500 USD) requires 700 lots in 12 months
- Broker C - 20% Bonus (300 USD) requires 45 lots in 6 months
Which should you choose?
The correct answer is none because no bonus terms are below your volume tolerance.
Even if you take a risk to get the 20% bonus, it must be understood that it will be in vain because you will only force yourself to complete a transaction of 45 lots which is not what you set up to in 6 months.
This kind of consideration will help you choose the best type of forex bonus that can meet your targets. It is better not to get a bonus at all than increasing your risks just to get a bonus.
If it turns out that your strategy has met the required volume, then there's no harm in joining the bonus program. You can check new updates on forex bonuses here.