Broker to Trading

1 standard lot in Forex is $100,000 (or more generally 100,000 units of a currency). A cent account is denominated in cents, and 1 lot = $1,000 (since 100,000 cents = $1,000). Thus, 0.1 lots on this account is really 0.001 standard lots and has a pip value of 1 cent, using a USD example on this page with a pip value of $10 per standard lot (the actual value of a pip per lot can vary depending on the account currency and the Forex pair).

A broker may allow even smaller trade sizes by providing micro lot cent accounts, where position sizes can be as low as 0.0001 standard lots, resulting in very small pip values. To be clear, it's not called a cent account because 1 pip = 1 cent, but because it is denominated in cents, with a lot size of 1,000. So a cent account can have trade sizes where one pip is worth less than a cent.

In the past, brokers used to offer specific accounts for smaller lot sizes, for example, mini (0.1 lots) and micro (0.01 lots) lot accounts. Forex brokers these days tend to simply have a minimum lot size of 0.01 lots for their Standard account types. Thus, the trader can build trades with small or higher trade sizes as they wish.

One advantage of smaller trade sizes is that it can make trading feasible and comfortable for smaller account sizes. Another important potential advantage is that it can help the trader trade with reduced leverage (increasing leverage increases risk). Leverage helps traders trade with smaller account sizes, but increases their exposure to adverse moves against the traded position.

Another potential use for a cent account is to practice trading in the real market, possibly after using a CFD trading demo account. However, unlike a demo account, real funds are being risked in a cent account. Cent accounts may have a very low minimum deposit and be separate accounts.

Other accounts that have a higher minimum trade size (for example, micro lots) may have higher minimum deposit requirements. Brokers may also offer accounts for traders who wish to trade Forex with bigger accounts. Traders can also generally place orders with a bigger trade size on a cent account, but there is typically a limit on the maximum order size, relative to other account types.

The Forex market moves in complex ways, and a cent account can be a way for all traders to understand it, without having to place trades with a high pip value. The actual value of a pip move can either add to the account or deplete it, as Forex pairs change value. With higher pip values, an account can rapidly be depleted. For example, if the stop out is set at 50% of the account, positions will automatically be closed if the account reaches this level. Of course, this possibility also exists on a cent account with a small account size.

So the relative value of a pip to the account size is an important consideration when trading Forex, which tends to retrace against the traded direction and can make rapid moves up or down. This can be seen in news trading or other volatile times in these markets, when very rapid moves can happen. One way to tackle this is to use a stop-loss; another way is to get the balance right of account value, positions opened, and trade size. The brokers in this table offer MetaTrader accounts with very low trade sizes as well as other account types and are well-established, regulated Forex brokers.

Cent accounts vs contract size

A true cent account is one that is denominated in cents. However, brokers may still offer cent style sizing, not by denominating the platform in cents, but by providing very low contract sizes.

Best Forex Cent Account Forex Broker

The pick from the table of the best cent account Forex broker is XM. XM offers both MetaTrader 4 (MT4) and MetaTrader 5 (MT5). XM offers very low trade sizes on its Ultra Low account, down to 0.0001 standard lots.

In tandem with a low minimum trade size, XM offers a very low minimum deposit ($5). Thus, traders may trade with a smaller account size if they wish. Small trade sizes can potentially offer the trader flexibility in terms of minimum deposit, account size, and what markets they can trade. On MT5, XM has a relatively large number of markets to trade (1000+), in addition to Forex pairs.

XM supports Forex traders by offering these platforms, allowing small trade sizes, and letting the trader use and build Expert Advisors (EAs) to automate trading, if they want to automate their trading. When signing up for an account the trader chooses which platform to trade from, but they can create further accounts later as they wish, if they want to try the other platform.