About Time: You Tried Forex TradingBy Angelica Malin
If you’ve spent any time exploring money making schemes and side hustles, you’re certain to have run up against the concept of Forex trading. It’s rapidly becoming one of the hottest topics in the amateur investment arena, and part of the attraction is the complete flexibility.
You can stick £50 into a trading account and spend a few hours each week trying to make it grow, or dive headlong into full time trading as a career. For many, the former approach can lead to the latter. All you need is the right phone app and a solid strategy. While the first is relatively simple, the second aspect takes work and research. However, as with anything in this world, you reap what you sow, and the rewards can be impressive.
Can you really make money?
Visit one website, and you’ll be reliably informed that trading Forex is your passport to millions. Ask someone else and you’ll be told that if you are a novice trader, you have a 90 percent chance of losing money and you are better off putting that £50 on a horse. So who’s right?
The unsatisfying answer is they are both right and they are both wrong. What it comes down to is that the Forex market has always been a place where those who know what they are doing and follow a sound and methodical trading strategy have the opportunity to realise impressive returns.
It is also a place where the old proverb about fools rushing in holds true. The increasing proliferation of online trading tools have led to plenty of people throwing their money into trading without the first idea of what they are doing. And with that approach, you really are better off having a day at the races.
The statistic about nine out of ten Forex beginners crashing and burning is right. But why do you suppose that is? One thing is for sure, it’s not because of any change in the market – it is still just as profitable as it has always been. It’s purely down to the fact that most amateurs try to run before they can walk.
Learning takes time
One of the reasons that amateur investors used to leave Forex to the pros was that it seemed far more complex than simple share dealing. There’s a reason for that – it is. If you want to learn trading Forex successfully, you need to do more than spend a couple of hours reading the financial press while CNBC plays in the background.
Before you do anything else, it is worth setting yourself up with a broker and installing an appropriate app on your desktop or smartphone. Choose one that lets you start with a practice account, that way nobody gets hurt – least of all your bank balance.
There’s plenty to be said in favour of the internet age – we have exhaustive information on anything and everything in the history of human knowledge right at our fingertips. The problem is that it can make things seem far more simple than they really are. It’s easy to fall into the trap of believing that a five year old can drive a car after playing on a racing game, or that anyone with a virtual reality headset can perform brain surgery.
Likewise, the internet has demystified the Forex market by providing us with numerous guides and tutorials. That’s great, but it is still a complex financial instrument that demands knowledge, practice and a decent grounding in mathematics if you are going to truly master it.
Develop a plan – and stick to it
Understanding the theory and knowing where all those foolish and over keen traders go wrong is one thing. Avoiding the elephant traps and making sure you follow your own advice is another. This is another reason why a demo or practice account is such a useful tool when you are first starting out.
Even the most calm and professional trader can get caught up in the excitement of trading, and it is so easy to deviate from your well-rehearsed strategy as soon as things start to pan out a little differently to what you had planned. When you start chasing losses, you are on a road to disaster, so it is vital to stick to your plan, no matter what.
Anyone can succeed – or fail – at Forex trading
The wealth of apps, guides and trading platforms available online mean that Forex trading is accessible to all. Adopt the right strategy and you can turn it into a lucrative side-hustle, or even something bigger. Best of all, you don’t need to invest thousands to get started.
That sounds highly positive, but always keep that 90 percent statistic tucked away in the back of your mind. The smartest of cookies can get burned by Forex trading due because of a flaw in their strategic thinking. But if you take it slow and exercise sound risk management principles, there is nothing to stop you from coming out on top.