Forex is by far one of the most liquid markets offering plenty of opportunities for those earning their nine-to-five job salary. If you are one of those or you just want to try your hand, here is how it’s possible to do.
Know the market
Forex is a currency trading market that turns trillions of dollars per day. It was not always accessible to anyone. Today, thanks to the web, you can find a reliable online platform and turn your money into big money with several clicks. Of course, it’s not just as simple. The learning path could take up to several months, depending on your dedication and willingness. You will have to know the market before embarking on it. But no worries. With so many free trading resources available within your broker’s offer or elsewhere like youtube and free pdf books, you are on a good way to start learning progressively. Forex is one of the easiest to master. However, the practice gives the final touch.
Practice on a demo
Start practicing doesn’t require putting the money in your trading account and start trading straight away. That’s why the demo is so convenient. You just register and have the opportunity to try the platform and experiment with the trading strategies on your own, without penny invested.
Over the course of learning and practicing, you will grasp the notions such as currency pairs, volatility, spreads, pips even the difference between CFD and invest for those more curious about investment options. Besides, you will have first-hand insight into the analytical tools needed to implement some strategies while trading.
Is it risky?
As with any business and trading, you invest some money in the expectation to earn more. In Forex, it might be risky as long as you miss putting a stop-loss order. Once the pair reaches a certain price, you put the stop loss and limit your loss on trading positions.
Furthermore, there is leverage, the core aspect of the trading in Forex. You can borrow the money from the broker with the leverage ratio from 1:100 to 1:1000. The best is between 1:200 and 1:200. However, it depends on your budget and trading plan. However, beware it’s borrowed money and a two-edged sword in some cases.
Finally, the risk may come from the scammers, which flooded the market once it became lucrative for both individual traders and brokers. You must learn how to spot them and avoid them.
Volatility
Besides the possibility of using leverage, there is volatility as a core feature of Forex. It sounds scary, but it’s not. That’s where you reap the profit when the market goes up and down thanks to technical indicators, news following, and special financial events, and of course the situation on other markets, especially commodities, like oil, gold, copper, etc.
Choose trustworthy broker
You need a broker to execute your trading orders. The brokers offer you a platform for trading; These are top-notch software created to fulfill the needs of seasons and newbie traders. You can usually trade with the help of your personal broker and menthor. The aim is to find a reputable, regulated and trustworthy company that is translated in its business. It has to have good customer support, many other assets for trading and needs to be transparent. Always check the contact details and try to reach out to their support before even putting your money into your account.
In Conclusion
Forex could be an amazing source of second income for anyone ready to go by the book, starting from the learning process to the careful choice of the broker. Once you learn the ropes to win first trades, you will understand the excitement and joy it brings along with the money, of course.