The forex market is a great playing field for many traders who would like to see large profits in a short period of time. Forex stands for foreign exchange and the forex market is the largest market in the world, with over $3 billion traded daily. Forex markets are open 24 hours a day, 5 days a week so an eager trader can place trades almost any time of the day or night. Traders believe they can make money easily in forex and while there are many opportunities to profit at forex, there is also a high risk of losing money within a short period of time.
Who Can Become a Forex Trader?
Anyone can trade forex. However, it takes time and patience to be a good forex trader. Becoming expert at the basics of how forex works is the key to good trading. In addition, maintaining a certain amount of discipline in managing your money and monitoring the amount you invest are essential elements for ensuring profitable trades. Once the basics of this investment vehicle have been mastered, learning advanced techniques for following a specific investment, such as the use of indicators and graphs, is essential. Creating a trading plan and sticking with it while learning to control your emotions are also important characteristics that can lead to forex success.
Essential Steps to Become a Forex Trader
If you want to make some serious money trading forex, here are a few tips you should keep in mind:
The first thing that you need to think about is the reason why you want to start trading in currencies. Are you interested in making some extra money to supplement your income? Or are you planning to make forex trading into a full-fledged career option? Maybe you just want to have some fun gambling your money away.
The first step to becoming a successful forex trader is to learn all you can about the world of forex. Learn forex here. Forex is not as easy as most people think and proper education and training is key to coming out ahead. Many brokers offer free tutorials on their site and there are many other online forex schools to choose from.
Once you feel comfortable with Forex, it will take only a few minutes to open an online forex brokerage account. There are plenty of forex brokers to choose from so do proper research before settling on any one broker. Speak to experienced forex traders and compare features offered by several different brokers. Before opening an account, spend a few months practicing your trades in a free demo account where your trades are executed with virtual money and the fear of losing all your funds is eliminated. The demo account also allows you to gain confidence in your skills and decision making so when you trade in a real account you will be able to do so in a more professional manner.
Decide upfront how much money you are willing to lose in this endeavor. Since 80% of new forex traders lose all their money within days of placing their first trade, setting a limit to your losses is very important. Beginning traders should start their account with the broker’s stated minimum required amount. Once that has been depleted, you will be faced with the choice of using additional funds or sitting out the next few days in order to get a better handle on the markets. Not an easy choice to make.