Forex Bonus – How to Identify a Good One or Scam

Trading Forex with bonus seems to be a great opportunity for new users to get extra free bucks to the balance. However, a Forex bonus can be very tricky. Some brokers establish wagering requirements that are hard to meet. As a result, some investors face difficulties when trying to withdraw their profits.

Definitely, different promotions come with certain advantages and disadvantages. But what is more important is the ability to differentiate between a reliable one and a scam. At least, you will be totally protected from fraud. In this article, we will highlight some easy steps to identify a trusted Forex deposit bonus as well as other popular types of trading promotions.

Why Platforms Use Forex Broker Bonus

With the growth of Forex trading, many platforms started developing their business models offering different tools and trading conditions to potential clients. They actually started offering full-scale brokerage services. However, the competition has increased drastically over the last decade. Brokers are looking for new ways to attract as many new customers as possible.

On the other hand, we have a group of traders who consider a Forex bonus critical for their strategy. What’s more, they can choose from different bonus types making their entrée a bit more flexible in terms of finances. Furthermore, some users consider it the main factor when choosing a platform to involve in Forex trading or enter other financial markets.

The main challenge here is that not all bonuses are fair. Some of these promotions are used only as a hook. They do not provide a real sense when it comes to saving cash. Besides, some companies make them extremely difficult to use and gain. This fact makes such promotions more like a scam.

3 Points to Differentiate a Trusted Forex Bonus from a Scam

The following criteria will help you recognize a reliable Forex bonus and avoid a potential scam.

Platform’s Credentials

Authority and licensing are the two most significant features every trader should look for. The idea is to find as much information about a chosen platform as possible. Reputation on the web can be very helpful. As a rule, only fraudulent brokers do not obtain the necessary licensing or do not have globally recognizable experience in delivering financial services.

Turnover Conditions

Converting a Forex welcome bonus or any other type of promotion into real money that you can trade with is the biggest challenge for the majority of users. Generally, the turnover conditions are practically impossible to meet. So, if you see a necessary money turn that exceeds 50 times, that bonus is very likely to be a scam. Regularly, trusted brokers never exceed the 10x turnover conditions.

A Minimum-Required Deposit

A trusted broker does not set specific limits for the initial deposit to get a welcome or reload Forex bonus. If the depositing requirements are too high (or the deposit required for a bonus exceeds the baseline minimum deposit for the rest of the traders), the promotion is likely to be a scam. It is better to leave it and walk away.

Forex Bonus Pros and Cons

Nothing is perfect in the world of Forex trading. The market can be very tricky as well as promotions. However, we can say that using trusted offers can make sense, especially if you are not targeting huge wins right at once and only want to test your strategies with minimum or no risk of losing cash.

Forex bonus advantages:

1. Some bonuses can be used as a margin. It can be a backup in case your balance goes below the critical level resulting in the margin call.
2. Some brokers offer no deposit bonuses that are free to use and claim. It means no initial deposit. All you need is to register. However, this particular type of promotion comes with super strict requirements making it hard for users to meet them.
3. Bonus money is a great foundation to test out your strategies under real-market conditions without risking your own funds.

Forex bonus disadvantages:

1. Wagering requirements are sometimes very unclear and hard to get, especially for beginner traders who do not know what to primarily look at. It can lead to losing not only bonus money but also their own cash.
2. Bonuses are hard or impossible to withdraw. Besides, they can rarely be used as a margin. So, one can expect bonus money to be taken by a broker when the balance critically goes down.

The Bottom Line

A Forex bonus is mainly a broker’s tool to attract as many new users and customers as possible. Scam platforms use different promotions to mislead beginners and make them trade with initially unfavorable conditions. However, some simple factors will let you identify a reliable broker bonus or a scam. Just make sure a chosen platform is authorized and licensed. And one more thing, do not consider bonuses as free cash, use it more like free virtual funds to try out different techniques with no risk.

This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.