Do you want to invest with HotForex? Do you want to learn about the commissions and reviews from their clients? Is it cheap and reliable? Before trading with a broker, we have gathered the following questions. We will be quick at providing you with answers. Although Hotforex is not a bad broker, there might be better alternatives. For example, you can take a look at Plus500, they do not charge any commissions –click here to visit their website. This partly explains why it is one of the leaders in CFDs in 2020. You can learn more about it by clicking the button below. In any case, this article is about an analysis of HotForex, so throughout this review, you will see our opinion about this company (76.4% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money).
Hotforex has gained a lot of fame in the UK due to the growth in trading with CFDs on forex, cryptocurrencies or stocks. However, whether a broker is famous or not, is not enough to hire them. There are many issues we have to analyze beforehand, and that’s precisely what we will do in this review, so here we go.
Tabla de contenidos
- 1 Do I need a broker to trade CFDs?
- 2 Is HotForex safe? Is it a scam? Regulation
- 3 Commissions
- 4 Opinions and conclusions about the review
Do I need a broker to trade CFDs?
If your goal is to trade CFDs and are barely beginning your journey through the finance world, you should definitely know that the risks are very high and it might not be a product for you. If you are already an expert, you may be interested in hiring the services of a quality broker.
However, the biggest challenge is not decide whether or not to use a broker, but which is the most convenient among all of those available in the market, since many sites lend themselves to scams that result in money theft for hundreds of people.
This time around, we will conduct a review about Hotforex, based on the services offered to their clients, its reputation and track record, in order to determine whether it is a good option when investing your money in the currency market.
Is HotForex safe? Is it a scam? Regulation
This broker was founded in 2010, and is also known as HF Markets. It is headquartered in the Republic of Mauritius, a country located in Africa. So as you can imagine, it does not provide us much security. There are also other offices around the world located in various countries in Europe, Asia and the Americas.
Hotforex is regulated by different institutions, including its registration in Saint Vincent and the Grenadines, as well as in the Cyprus Securities and Exchange Commission or “CySEC” of Cyprus and the FCA. Although these regulations provide a certain authenticity to the broker, it does not mean one cannot make scams through it or that it is a 100% reliable agency, so it is always advisable to look closely to all types of transactions.
If we compare it with Plus500, we will see that they have offices in London, and that Plus500UK Ltd. is regulated by the FCA in the United Kingdom. Thus, Plus500 looks like a safe broker (76.4% of retail CFD accounts lose money).
Security of funds
Beyond the aforementioned regulations and permissions, Hotforex offers other security benefits to its clients, such as services in a variety of international banks worldwide. In addition, according to the broker’s policies, customer funds are reserved in separate accounts to the company’s funds, avoiding the possibility of embezzlement.
In addition, HotForex has a protection policy in the event of negative balance due to a forced stop out, ensuring to protect the money of its customers.
HotForex allows its clients to open accounts with a minimum 5 dollar deposit, a low investment that seems perfect for those who are starting in the finance world and do not feel confident in making large deposits. However, we want to emphasize that CFDs are not for beginners since they are risky and complex products. Account transactions are also accepted through a large number of banking platforms such as bank transfer, Visa, Mastercard and Maestro credit cards, or Payoneer, Skrill, Webmoney, PerfectMoney, CashU and Neteller debit cards.
Hotforex accepts deposits in a variety of currencies, including dollars and euros. They have different services for their clients which allows them to use a variety of tools to learn about investment management.
However, despite these excellent features, we believe HotForex leaves a lot to be desired in terms of security and, as we are going to see next, they have bad conditions in terms of commissions and spreads compared with other companies. In addition, we don’t have the opportunity to invest in Ethereum, Bitcoin, Bitcoin Gold, Bitcoin Cash, Ripple or Litecoin.
Conditions according to the type of account
This broker offers different types of accounts, which are adjusted to the needs of clients with different characteristics depending on the investment, the benefits and the market risk the client is willing to take on. There are eight different types of account with different trading conditions which are listed below to provide a greater understanding.
Micro accounts are for small individual investors, with minimal knowledge of the ups and downs of the currency market and who wish to make minimal investments.
These accounts require a minimum deposit of five dollars and have variable spreads of 1 pip, this allows the client a maximum leverage of 1:30 and a maximum of 150 accounts opened simultaneously.
In addition, micro accounts do not charge commissions and are managed with Metatrader 4 and Webtrade trading platforms.
This type of account requires an investment of over $ 100 and a variable difference of zero pips and can handle from 60 to 500 accounts according to certain conditions.
This account follows the Zero account in order of investment, since it requires a minimum deposit of $ 250. The spreads of the Pamm account are variable type and of 1 minimum pip in Forex and something more in the remaining of assets. It allows a maximum of 350 open orders simultaneously.
HotForex offers this type of accounts for clients who feel more confident about the CFD investment in Forex, stocks and commodities, since the minimum deposit is $ 500. Similar to the Micro account, the spreads in this case are variable and 1 pip.
They can handle up to 300 Premium accounts simultaneously, and mainly uses the Metatrader 4 and Webtrader trading platforms and does not charge commissions per client.
Like the Premium option, this account requires a minimum investment of $ 500, with spreads of variable type and 0.2 pips, allowing a maximum of 350 open orders.
This account is also for unsuspecting investors, designed for traders searching for fixed spreads beyond market conditions. This account requires a minimum investment of $ 500. The difference in this case is that spreads are fixed, and allows for a maximum of 300 open accounts.
This is a special account, designed to offer traders with any type of trading system, selecting suppliers through the Metatrader 4 and Webtrader platforms, as well as through mobile applications in an automated way, hence its name.
The minimum deposit for this account is also $ 500, and with variable spreads of 1 pip. It allows a maximum of 300 open orders simultaneously.
This type of accounts is for large investors who are not afraid to deposit large amounts of money in exchange for even greater profits, but always with a considerable market risk.
It requires a minimum investment of $ 20,000 with spreads from 0.2 pips. This type of account works in different trading platforms such as MetaTrader 4, Webtrader and mobile trading, with a maximum of 400 simultaneous transactions.
With VIP accounts, HotForex charges $ 6 commission per standard lot of purchase or sale, but allows the client three thirty-minute private consultations with a Senior Analyst of Hotforex, Stuart Cowel, with over 25 years of experience in the business.
Finally, the demo account seems somewhat essential, but HotForex does not have a quality one with the assets we prefer. If you want one, click here to obtain a free Plus500 demo (76.4% of retail CFD accounts lose money). All you have to do is click on “start now” and then select the trial version. This will allow you to trade for free and without risk with the test simulator. In addition, it is totally free, unlimited, and in English. In our opinion, if you are beginner, a demo is a very interesting option.
Opinions and conclusions about the review
Hotforex is an investment platform with little prestige in the finance world, with certifications that make it as a slightly reliable and recognized company. One of the important aspects of currency trading in Forex and with CFDs on stock and similar shares is the security of the broker, and HotForex does not offer much. In fact, one can find warning about HotForex in FCA’s website. Therefore, we believe it is better to trade with a broker that holds a stronger regulation, and that does not charge commissions to operate. For example, Plus500 allows to trade without paying commissions (76.4% of retail CFD accounts lose money).