Are you wondering how does plus500 work? Plus500 is an operator making the link between the trader and the real FOREX market. This is the equivalent of what is commonly known as “forex broker.”
Forex brokers today offer online trading platforms in the form of software (available online or downloadable) that allows you to execute your trading operations.
Traditionally, traders call for their banks to execute their trading orders. Today, the situation is different.
Plus 500 Review
- Low spreads
- Listed on AIM section of the London Stock Exchange
- Platform user-friendly
*Trading bonus are not eligible for clients registered under Trading Point of Financial Instruments Ltd and Trading Point of Financial Instruments UK Ltd
All brokers offer the possibility of trading in virtual or “demo” mode. Which leaves you plenty of time to practice speculation on the FOREX market without taking the risk of losing real money!
When you trade with real money, the broker takes note of your orders and applies them instantly by investing your money using major international banks.
Your capital is, therefore, placed on the Forex market, until you close your transaction in order to recover your capital inflated by your profits or reduced by your losses.
Therefore, if you ask how does plus500 work? Plus500 like any other forex broker. They place your money or retire them from the forex market. In other words, they execute your orders. They buy and sell currencies for you.
How does plus500 work in the forex market?
To understand how plus500 works, you need to understand how the forex market works.
In forex trading, you sell and buy currencies. For example, you can sell euros to buy dollars when the dollar is strong and then resell your dollars for euros when the euro is strong. As a result, you make a net profit or loss. Through the work of forex brokers, trading forex offers the following advantages:
– ease of use: With a few clicks, you can place orders and make profit.
– a rapidly expanding financial market: Every day, more than 7 trillion dollars are traded on Forex and this amount continues to grow. This, therefore, proves the dynamism of the foreign exchange market and the attraction that it can have for all types of investors.
– Fast entry and exit: Unlike some financial markets, Forex doesn’t stagnate very much. Better yet, we can see that real upward or downward trends are remarkable in the short and medium-term.
– availability of information: It is often said that it is difficult to predict the evolution of the share prices of certain large companies because economic and financial information is sometimes kept internally. Also, trading currencies on Forex is much simpler since news releases (which influences the value of the currency) is easily available and will not require much research.
So, since you have an idea about how forex market works, let discuss how Plus500 grant you access to the forex market.
How Plus500 facilitate forex trading?
One of the questions that pup up to our minde when we ask how does plus500 work? is to investigate how it operate in the financial market.
Indeed, Plus500 works as an intermediate between you-the trader- and the forex market. Therefore, it offers an online platform through which a trader place sell or buy orders.
Plus500 offers two type of platforms, MT4 and webtrader. They are both downloadable softwares that can be downloaded here after registering an account.
Once a you register, you can download MT4 to train. For this matter, you can open a demo account here. It’s free and doesn’t cost you anything.
After you open a demo account, you wonder: how does plus500 grant you access to the market? The answer is easy. In fact plus500 works with traders by offering them 2 different account types.
Plus500 account types
Plus500 offers two account types, consisting of a demo account, which has no time limit and can be opened for free, and a live account which requires a minimum deposit of $ 100.
It offers customers a $ 20 “welcome” bonus on all accounts, including the demo account and generous bonus of up to $ 7,000 for initial funding. The leverage for forex accounts is a maximum of 1: 100.
As a result, to open a real account and start trading, you need to make a deposit. Plus500 offers a lote of options.
Plus500 deposit and withdrawal
This broker offers you several deposit methods, namely bank transfer, card deposit as well as by Skrill and PayPal electronic wallets. The bank transfer takes longer. It can take up to 3 business days before your funds are available for trading. The minimum deposit to benefit from a Plus500 real account is € 100 for card deposit and € 500 for bank transfer.
Card and electronic wallet deposits are instant, your funds are almost immediately available for trading on Plus500.
With regard to withdrawals, you can make them with the same method as that used at the time of the deposit, as long as the amount of the withdrawal does not exceed that of your deposit.
What makes plus500 works better for traders?
There are two most important things that makes me believe that plus500 is best for any kind of traders. They are security and negative balance protection.
security makes plus500 works better in comparison to other brokers
A very secure broker, present on several continents, notably in Europe.
Plus500 has set up several branches to better adapt its offer to the different jurisdictions under which the broker operates.
- Its Plus500CY Ltd branch is regulated by the Cyprus Securities and Exchange Commission (CySec)
- Plus500UK Ltd is regulated and licensed to operate in the UK by the Financial Conduct Authority (FCA)
- Plus500SG Pte Ltd is regulated by the Monetary Authority of Singapore, the central bank of Singapore.
- Plus500AU Pty Ltd is regulated by several organizations, including the Australian Securities and Investments Commission (ASIC).
- Plus500 is also authorized to offer its services in France by the AMF.
All these regulations enhance the security of funds for Plus500 customers. Accounts receivable are segregated, that is, separate from the broker’s working capital. As a result, in the event of the broker’s bankruptcy, the broker will always be able to return your capital, at least for part.
Indeed, according to the jurisdictions, Plus500 can guarantee a certain protection of the funds of its customers.
Those who are in Europe or the United Kingdom benefit from a guarantee of protection of up to € 20,000 and £ 85,000 respectively.
Traders in other parts of the world, however, do not enjoy guaranteed protection. We still want to emphasize that Plus500 is a reputable broker, who maintains excellent service even in countries where they are not regulated.
Negative balance protection
Negative balance protection is an engagement required by the European Securities and Markets Authority (ESMA) for brokers operating in Europe. It allows traders to limit their losses to the amounts of their deposits.
For example, if you make a deposit of € 1,000, your losses on your positions will not exceed € 1,000. It sounds obvious, but with margin trading, you can lose more than you have deposited when volatility increases dramatically.
Plus500 will, therefore, close all of your open positions if your funds fall to zero.
Plus500 is a reliable online broker. It works better for both novice and experienced traders.
Plus500 is indeed listed on the London Stock Exchange and publishes its results. It is also regulated by several regulatory bodies on several continents.
Its platform is user-friendly. It is both professional and suitable for beginners. Through this platform, technical and fundamental analyzes can be carried out. The trading costs of Plus500 are quite competitive. And the broker has quality customer support.