Funded Forex Accounts – What is Buying Power?

Forex Funded Accounts - What is Buying Power

Beware the illusion with Funded Forex Accounts, all is not what it seems!

A lot of traders have been asking me about ‘buying power’ lately. The thing is, we don’t have any reference to it anywhere on our website or associated with our T4TCapital Forex Trading Program so I can only guess they are referring to what other companies are offering in terms of forex funded accounts.

Put simply, ‘Buying Power’ refers to trade size.

For example, if you have $500K in buying power, that means you can trade 5 standard lots.

If you have $200K in buying power, that means you can trade 2 standard lots.

It has absolutely nothing to do with the account size, although it looks like it when you choose your account size.

When you sign up you choose your account size, which can be anything from $100,000 to $500,000 with a rolling monthly subscription until you reach the profit targets.

It sounds enticing right. Who wouldn’t pay $300/month to get a chance to trade a $500,000 live account?

Well, this is where the illusion (clever wording and marketing) comes into play, as your $500,000 Demo account shrinks into a $5,000 Live account once you reach the profit target. Read the fine print…. “You can earn $500K in buying power.”

That’s right, you’re the proud manager of a $5,000 account with $500K of ‘Buying Power’. You can trade 5 lots!

Now that’s got to be a massive psychological blow to any trader

The programs do offer traders an opportunity to manage funds with very little upfront cash. But I just don’t see the need for the deception, tricking people into thinking they could earn a much bigger account than what is available for funding for forex traders.

They should just be upfront about it if they want to be considered among the best forex prop firms. But then again who’s going to sign up to a program where you get a $5,000 trading account? Not many.

For good measure if you compared our trading accounts then the following would apply:

$25,000 account = $250K buying power

$50,000 account = $500K buying power

$100,000 account = $1M buying power

But the difference with our T4TCapital Trading Program is, the forex live account – your Live Trading Account will be the same size as the Demo Practical Assessment!

We are happy to answer any questions.

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