Hi I am about to open a demo forex account but i am sort of confuse what to choose.
I an being ask whether to use SGD or USD as the acc currency. So what is the difference? How will it affect my trading? I normally use USD as the acc currency but would wanna know is there any major effect if I use SGD as my acc currency? How will the calculation be like? Oh btw mine is a mini acc.
Gummy=)
Hi, that's a good choice to start with! A demo account is a good way to start trying your strategies.
To answer your question, the only difference with either choosing a USD or SGD account is the exchange rate.
Say you open your account with the base currency of SGD, when you open a position eg. Buy EUR/USD, 90% of brokers will convert your SGD to USD before opening the position. That's the disadvantage as exchange rates tend to be 'slightly' above market rate (or the brokers fixed exchange rates) Benefit is that you will be able to manage your money quickly instead of constantly checking the exchange rate.
Say you open your account with the base currency of USD, when you open a position eg. Buy EUR/USD, there is no conversion needed as your account is already trading in USD, hence you avoid any form of the brokers pocketing, compared to if your account is in SGD.
Disadvantage would be that USD currency is very uncertain at the moment and it fluctuates very often.. thus when you withdraw, and is USD/SGD rates fall, you will get lesser SGD, but on the other hand, if the rates rise, expected you will get more.
To sum this all up, both have it's pros and cons. But on a personal view, i would stay just stick to a USD account. It clear the confusion....
Wish you all the best in your trading!
