Can I use Forex broker account as multi-currency bank account?

External question — Personal Finance Stack Exchange Author: Maci0503 Original post: https://money.stackexchange.com/questions/123218 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. On a Forex account, one usually opens, then closes a position after some time. On a multi-currency bank account, permanent change can be achieved between the currencies. My question is if actions similar to the multi-currency bank account can be taken on a Forex broker account (with or without using leverage)? Can the leveraged money be stored in different currencies in the long term? (On a broker account I mean metatrader4 platform, and any average Forex broker.)

External answer — Personal Finance Stack Exchange Author: S Spring Original post: https://money.stackexchange.com/a/123224 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Certainly, the forex account is in Base currency and positions in the account are, for example, either sell Base/Other, buy Other/Base, or Base cash. If the account deposits and the account positions are the same size then there is no actual leverage even though a margin deposit is accounted to each position. That accounting makes a free cash balance amount. In fact a buy of Base/Other or a sell of Other/Base in a Base currency account, even if un-leveraged, also makes sense because there is a choice of which other currency to set against. Simply holding Base cash would be like holding un-leveraged Base currency against a basket of other currencies. A regulated forex broker keeps customer deposits in bank accounts separate from their operating funds. Some forex brokers pay interest on the free account balance. A forex broker in Denmark has government bank insurance on customer deposits.

External answer — Personal Finance Stack Exchange Author: Kevin R.A Original post: https://money.stackexchange.com/a/163808 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Forex broker accounts and multicurrency bank accounts serve different purposes. There are some similarities though Currency conversion: you can convert currencies in a forex account without necessarily opening and closing trading positions Long term storage: Most brokers allow you to hold multiple currencies in your account long-term. But you must check the charges before doing so. No leverage for storage: Leveraged money cannot be stored long-term. Leverage is for active trading positions only, which means it may attract swap charges, which can go really really high. Fees and spreads: Forex accounts may have more favorable exchange rates but could incur other fees Purpose: Forex accounts are primarily for trading, not banking services. Regulation: Forex accounts typically have less protection than bank accounts. So be careful. Functionality: Forex accounts lack typical banking features like direct debits or card payments. So you lose on all those features. While you can use a forex account for some currency management, it's not a direct substitute for a multi-currency bank account. Each has its own advantages and limitations. I hope this helps :)