For many beginning traders, the first thought about the question in the title of this post would probably result in a negative answer. Obviously, what is the point in diluting your trading capital between more than one account? Many new traders struggle to get enough starting capital to execute diversified strategies and safe position sizing techniques. Dividing it between several accounts would only hurt in that case.
In my opinion, despite that obvious disadvantage, there are some reasons to use multiple trading accounts for trading:
Seeking best price. In terms of Forex trading, it means finding a broker (or account/platform within one broker) with best spreads or overnight swaps for your strategy.
Seeking the right trading instrument. It may happen so, that your current broker cannot offer a trading instrument (e.g. some exotic currency pair), but you have a great trading idea for it, so the only solution for you is to open an alternative account.
Moving to a new broker, but keeping old account. The cost of moving the whole account may sometimes outweigh the expected advantage of doing so (e.g. if it requires closing some long-term positions). In that case, the new account is funded separately, while the old one remains in use (albeit temporary).
Diversification of broker risks. Keeping funds at several brokers may help to save some part of your capital in case of one of your broker’s bankruptcy or scam-run.
Access to live account features. Some companies offer added value services (such as proprietary analysis, online tools, VPS, expert advisors, etc.) to their live account customers. If you keep a trading account with more than one broker, you can potentially reap more of such advantages.
I use four live accounts in my own trading. One account (AGEA MT4) is for the normal Forex trades based on my chart pattern analysis. Another one (AGEA MT4) is used for some of the commodity trades I rarely perform. The third account (EXNESS) is used exclusively for my long EUR/CHF bets based on current SNB policy. And my fourth account (Interactive Brokers) does not really count because it is for equity trading. And how about you?
If you want to tell us a detailed story of how you employ more than one live account in your Forex trading, please feel free to do it using the form below.