Starting trading forex while being under-capitalized wouldn’t be a clever solution. Experienced forex traders believe "the more the better" rule works here. But, even having this in mind, micro accounts’ importance cannot be underestimated, as they are much in demand among new forex traders. And even traders with enough starting capital pay a tribute to micro accounts. It makes it possible to open accounts with low starting capital, but at the same time to be able to diversify more and to use less leverage. Micro accounts imply a super low bar of entry. At micro account trades can be opened in lots of 1/100 of a standard lot, that is, in 1,000 units of currency.
Most of the forex brokers allow micro account holders to start trading with small deposits. Some allow deposits as low as $1. Micro account is one of the three forex account structures: the other two are mini and standard accounts. These types of forex trading accounts bear much lower risk. While the usual lot size in forex trading is 100,000, micro account holders can access a lot size of only 1,000 which is also called a micro-lot.
From a strategic point of view, micro accounts are helpful in testing various approaches to trading. For example, some techniques require simultaneous opening of dozens of market positions; with a micro account it is much easier to properly evaluate size and scale of the positions. Generally, it is useful to open a micro account once you want to test a new trading platform, or trading tools, or money transaction speed with no risk to your capitals. Despite the smaller lot size, micro account holders can still access similar trading conditions like any other account type by using leverage (leverage levels depending on the instrument and regulation, or specific trading strategy). The main purpose of leverage of Micro accounts is to make small retail traders access trading with larger expansion.
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