ARE FOREX BONUSES A SCAM?

If you are new to forex trading, you might feel alarmed at the options available to you, especially with the forex bonuses. After all, why would anyone offer you a bonus to join their site? Doesn’t it feel a bit off? You might even toy with the idea that you’re getting scammed. But is this the case? Not quite. 

Let’s start by stating that yes, there are scammers out there who prey on traders looking for bonuses. But when you review bonuses in detail before accepting the terms, you avoid these unscrupulous sites. A good example of a legit one is the fxtm bonus because the broker is regulated.  So, why would a forex broker offer you such a perk? Companies are always working hard to keep up with market needs and get a bigger share of the market. And brokers are not any different. They also want to attract more clients and keep the ones on their sites. And what better way to do this than by offering them bonuses?

While bonuses may seem like freebies, you should note that brokers also have something to gain from the transaction. And you should thus ensure that the bonus does not blind you to other things about the platform. We discuss what offers brokers offer and how you can ensure you get the best deal possible:

What Bonuses Are Available?

The two most common bonuses are:

  1. The no deposit bonus: As the name suggests, you get in on this perk even without depositing money on the site. As soon as you register and meet the broker’s requirements, you can start trading with the bonus. And guess what? If you win, you can keep the profit and use it to make more trades and increase your volume. Most people use this bonus to get a feel of how the site operates. But if you can make money out of it, the better.
  2. The deposit bonus: Many brokers prefer to reward clients who also deposit money on the site after joining. This welcome offer can come in two ways. The first is where every new client gets a fixed amount upon making a deposit. E.g., $50 for each new client who deposits at least $100 on the platform. The other is where the site offers a matched deposit to the clients. E.g., 50% of the deposit for amounts up to $100. In that case, if you deposit $100, you get to trade with $150.

Platforms also offer ongoing promotions where they target the most active traders and reward them with more bonuses. 

How to Use Bonuses

Are you wondering how you can make the most out of this opportunity? We have some ideas:

  1. Testing the platform: Sometimes, you are not quite sure if a broker is a good fit for your trading career. You can get a feel of the site, look at the pairs, watch how the system responds, and make an informed decision. It is much better than deciding based on what other people have said about the site. Plus, you will not suffer a loss because you can use the bonus cash to make trades.
  2. Testing your skills: Do you have what it takes to trade successfully? Reading about trading is one thing. But implementing what you have learned is another thing in its entirety. Sometimes, you find that your strategies are not suitable for live conditions, and you must thus go back to the drawing board. Wouldn’t you rather learn this after using bonus cash instead of when your money is on the line? Take your time to gauge how good you are and decide if you are ready to go live.
  3. Hedging your risk: Forex trading is one of the high-risk investments in the market. Thus, you might be feeling uncertain about going ahead with your strategy. Using risk-free money is one way to work through that anxiety and implement what you have learned along the way. If you lose, you will not have any losses to pick up because the money was not yours. And if you win, you get to enjoy free cash and add to it to trade in even better positions.

Of course, these perks are only available to you if you choose the right bonus. So, how should you go about it?

Making the Right Choice

There’s no need to rush and accept the first offer you come across. There are so many options in the market that you can bide your time and choose what aligns with your trading strategies. When choosing a bonus, you should consider:

  • Can you trust the broker? If a company has a bad reputation, do not accept the bonus no matter how good it is. 
  • Is the broker licensed? Without the right papers, your money will be at risk,
  • What are the terms and conditions of the bonus? Reading between the lines can help you understand when a broker wants to take advantage of you and avoid getting yourself in a trap.
  • Can you withdraw the profits from the bonus? There’s not much sense in earning a lot only to learn that you need to jump through hoops to get to it.

If a company meets all the above criteria, you can take advantage of the bonus and use it to better your trading volume. Most importantly, use this opportunity to learn how to strategize better for future trades. All the best!