‘Hooray’! This is the word used to express traders’ joy when they find out that their favourite broker is offering a new bonus.
A trading bonus is an opportunity for traders to receive extra funds to trade, and/or some other rewards too.
As you may have already seen, there are several types of bonuses: deposit bonuses, no-deposit bonuses, welcome bonuses, and others with fancier and more imaginative names.
Before you decide which bonus you’d like to claim, you’d better get an idea of how each one works and what you can achieve.
Although there are various differences between trading bonuses and promotions, there is one common truth behind them: if you use them wisely and responsibly, they can benefit you. You should also bear in mind that there are specific requirements (minimum deposit, minimum trading volume etc.) that you might need to meet to get/use your bonus.
The advantage of bonuses, especially for new traders, is that even when your trading budget is minimal, you have the potential to receive some extra money to boost your trading activity. The same applies to experienced traders in that bonuses will give them the opportunity to trade larger amounts of capital.
Different traders, different needs, different types of bonuses
Let’s recap on the three main types of bonuses:
Deposit bonus: You can claim this bonus either with your first deposit or with every deposit you make, depending on the offers. Deposit bonuses are beneficial for traders since once the bonus is unlocked, they can trade bigger sizes and more assets. In general, brokers offer 100% or less for deposit bonuses, but some (such as Eurotrader) might more-than-double your deposit.
No-deposit bonus: The no-deposit bonus doesn’t require the trader to deposit any funds. As there is no risk of losing your own money, the worst-case scenario is losing your bonus. But the best case is that you can successfully trade your bonus and make profits out of it (though it’s worth noting that you usually have to trade a specified total volume before you can withdraw such profits). A no-deposit bonus is great if you want to try different trading strategies or even the broker of your choice and their trading conditions.
Welcome bonus: Usually, the welcome bonus is what its name suggests: a complimentary welcome treat, like a fruit basket waiting for you at a Mediterranean coast hotel. This kind of bonus is usually transferred to the trader’s account following the registration and verification process. Sometimes you can get it automatically (like a no-deposit bonus), or you should first make a minimum first deposit (deposit bonus). The welcome bonus is usually a one-off, fixed sum equal for all new clients.
An important note is that you should always check the terms and conditions of each bonus to be sure that the one you chose is right for you, your trading experience level and your strategy.