A forex bonus is a promotion that you receive from brokers in hope that you will stay with the platform in the long-run.
Image: Supplied
With thousands of foreign exchange (forex) brokers operating in the online trading market, the industry has become saturated in recent years. As a result, platforms have become increasingly competitive to differentiate themselves from the crowd.
Forex brokers will offer a sign-up bonus to individuals who still need to create an account. This typically appears as a matched deposit bonus, which means that a specific percentage will increase your first deposit. In other cases, a no-deposit bonus may be presented to you.
To get started, find reliable brokers with welcome bonuses here.
What is a forex bonus?
A forex bonus is a promotion that you’ll get from brokers. Sometimes, the bonus will be offered only to those who sign up for the accounts. Although the bonus may cost the broker money in the near term, it is offered in the hoped that you will stay with the platform in the long-run.
For example, the broker may offer new customers a 100% matching reward of up to $500. Once you deposit, the broker will credit your account with the bonus amount.
No deposit bonuses work just as the name implies: you receive the bonus without making any deposits.
Forex bonuses always come with terms and conditions, which you should familiarise yourself with before joining.
Image: Supplied
Forex bonuses always come with terms and conditions, which you should familiarise yourself with before joining. Crucially, you must trade a particular amount before you withdraw the bonus dollars for real-world currency.
What are the pros and cons of forex bonuses?
Here are some pros and cons of forex bonuses:
Pros:
Cons:
How does a forex bonus work?
Let’s discuss how a forex bonus works.
Deposit bonus:
The deposit bonus is considered the most well-known bonus offered by forex brokers.
No deposit bonus:
A no deposit bonus allows you to receive free bonus money without depositing. These incentives are popular because they allow traders to begin trading without risking their funds. However, no deposit bonuses are typically smaller than deposit bonuses.
For example:
Forex bonuses always come with terms and conditions, which you should familiarise yourself with before joining.
Image: Supplied
Terms and conditions of a forex bonus
It is important that the terms and conditions of a forex bonus are followed. Generally, these will include:
These guidelines should give you a good understanding of what a forex bonus is and how it works. You will also know that brokers typically provide a matched or no deposit bonus. In either case, you must verify that you understand the bonus's terms and conditions – particularly with regards to the quantity of trading required before withdrawing.
Related Topics: