It is convenient of course, to only have one account with one Forex broker. However, it can sometimes be a good idea to open accounts with multiple Forex brokers.
The main reason why some Forex traders open accounts with multiple Forex brokers, is because it allows them to test the services of different brokers. All brokers offer different services; the mistake many beginners make, is they just go for the brokers with the lowest spreads (in other words, they go for the cheapest brokers). Some beginning, small-time Forex traders will even choose to go with the brokers that offer the lowest minimum deposits, just so that they don’t have to risk a lot of money in the beginning.
You should consider the overall services of brokers, because although you might save some money if you choose a broker with the lowest spreads for example, that same broker’s overall service might be very poor (for example they might offer very poor customer service).
In order to really test the services of different Forex brokers, you should open an account with each of the brokers that you are interested in; you don’t have to, but it might be a good idea to do so.
There are other reasons why it can be a good idea to open accounts with multiple Forex brokers. Some Forex traders might have more than one trading strategy; they might choose to scalp the markets on a broker’s trading platform that provides lower spreads and place long-term orders on another broker’s trading platform that perhaps offers a better all-round service.
Some Forex traders choose to open accounts with multiple Forex brokers, just to take advantage of the various tools and resources different brokers provide. Many online Forex brokers offer free fundamental and technical analysis for example; some traders and investors will have trading accounts with different brokers just so that they can take advantage of this.
There are some Forex brokers that do not encourage scalping and they limit the number of trades a trader can make each day in order to stop traders from scalping. This is another reason why some Forex traders will have multiple accounts with different brokers, because this will allow them to place more orders each day.
In conclusion, there are many reasons why having accounts with multiple Forex brokers can be a good idea. However, it is not at all necessary to have more than one trading account; it is only something that you might want to consider. There are some benefits that come with working with more than one broker, but again, it is not necessary to do so. Beginners especially will probably want to stick with one broker for some time before looking at others; Forex trading is difficult and beginners shouldn’t try to complicate things. If you are just starting out, it is wise to just have one trading account. However, once you build up some confidence and see some kind of success, you then might want to have a look at some other brokers in the business.