In the 21st century, it is not enough for a broker to tell you the services they offer. To entice you and create an atmosphere of customer satisfaction, they must come bearing gifts. Who doesn’t love gifts? For the record, most of the benefits and offers that brokers would offer you are in the form of bonuses. Perhaps you are wondering why your broker has to reward you. The reason for this is simple. As a result of the strict competition amongst brokers to secure new traders like you, they have to offer incentives. This incentive is your broker’s way of saying “thank you for choosing us”. One of such bonus offers is the forex deposit bonus. Its popular variant is the forex no deposit welcome bonus.
Other kinds of bonuses include: refer a friend bonus, cashback bonus, loyal customer bonus, etc. In this article, we shall explore the concept of forex deposit bonuses, the different types that exist, and their benefits and drawbacks. You will also discover ways you can avoid baits being disguised as gifts and how to utilize the bonus you eventually settle for.
Meaning of Forex Deposit Bonus
A Forex deposit bonus is a bonus that you get when you deposit a certain amount of money in your trading account. Its name is suggestive of the requirement for getting the bonus which is your deposit. This bonus is the most popular amongst the several bonuses that we have. Like every other bonus, the forex deposit bonus has its terms and conditions. These terms and conditions are not the same with every brokerage company. As they are at liberty to decide on their unique terms and condition that would guide their promotional advertisement. Perhaps you might be thinking “can I use my bonus on another broker’s website?” the answer to this is negative.
Terms and Beneficiaries of the Forex Deposit Bonus System
The forex bonus system has its target audience. There are two categories of people who are eligible to receive bonuses upon the fulfillment of certain conditions namely;
- Newcomers or new traders
- Active and loyal clients.
More often, the former category of persons receives more incentives than the latter. This is because the goal of each broker is to increase their reach, and bring in, and retain more clients. What better way to do this than to grant special offers to newbies once they make a deposit? If you fall into the latter category, any benefit you receive is a strategy to retain you as a trader on their platform.
The second category of bonuses is usually for LOYAL or ACTIVE clients. They can be given to you in different forms. One of such forms is by adding special features to your account, paying low fees on your financial payments, and receiving bonuses. It’s a customer retention strategy of telling you ‘we appreciate you for sticking with us during the good and bad times.
The bonus rate and range depend on the company. It usually spans from about 10% – to 100%. You will rarely find companies that offer deposit bonuses up to 200% like the MTrading platform. Often you are allowed to select the deposit bonus that should apply to your deposit. It can be 20%, 25%, 50%, or 75%. Before you settle for any deposit bonus rate, you should inquire about their trading volume and time limit. As it is not a factor set in stone. For some companies, the time limit may be 30 calendar days while others have a time window of 90- 180 calendar days. You also have to be wary of brokerage companies who would specify that the minimum time of qualifying trades is 15 minutes.
They often do this to restrict you from selling the required lot size by reducing the trade time. Once this occurs, you are not entitled to their bonus.
Types Of Forex Deposit Bonuses
We have clarified that you need to deposit before you can be a recipient of this bonus. How then do you wrap your head around the different ways the bonus offer works?
Hold up! Before you sign up to that trading platform, ensure that you make a detailed inquiry into their deposit trading system. This is where you apply the saying look before you leap’. Do not leave any doubts unsolved.
To discern between the wrong and right offers, you should use the reasonable man test. What would an objective person think in this situation? Is the gift defying marketing logic or it is too good to be true? voila! You have your answer.
The following is an explanation of the kinds of deposit bonuses often offered by brokers:
First Forex Deposit Bonus
This is the bonus that is given to first-time customers. Consider this a way of embracing newbies into the world of forex. A way of appreciating them for selecting a particular brokerage company.
What qualifies you to apply for this bonus is if your country is a recognized beneficiary of your broker’s promotional campaign.
If you have confirmed this, you would have to create an account, fill in your details and choose a currency. This currency would be the one to manage your account. You would also have to include your preferred deposit method. Once your deposit has been confirmed, you immediately receive the bonus. This bonus is a one-time offer.
Next Forex Deposit Bonus
From the name, you can deduce that this bonus system is a regular promotional strategy. With every deposit you make, you receive a fragment of that deposit as a bonus.
Forex Deposit Bonus For Regular Customers
As seen above, this bonus structure is targeted at customer retention.
This bonus is given to you by your broker to thank you for your loyalty and give you an unparalleled customer experience.
The bonuses granted here are very high compared to other bonus structures. It is evidence that your consistency in trading with a brokerage company pays.
If you want to enjoy your forex trading experience, it’s advised that you make regular deposits. You can even deposit large sums albeit inconsistently to get larger bonuses. The ball is in your court.
This initiative is suitable for an emerging market economy like Kuala Lumpur, Malaysia when viewed through the lens of its currency depreciation.
From statistics, we can see that foreign reserves would help stabilize the flexibility of the ringgits caused by global factors. Also, unemployed people can make money for themselves.
Since the proceeds from forex are taxable (income tax), the government would also benefit from this. And that can only mean one thing, developments on all fronts.
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