Forex trading is an extremely lucrative, but extremely risky, venture. If you make the right choices, or even just get lucky, you can very quickly become extremely rich. However, this is extremely unlikely and difficult to do.
Because there is only so much money in the world, a trader can only win as much as another trader loses. This is known as a zero-sum game, because every gain matches a loss. However, after the brokers have taken their cut, the winning trader will have made LESS then the other trader has lost. This makes it a negative sum game, and means the vast majority of people who attempt to trade, end up going broke.
So try and get out when you're winning. It's very tempting, if you take just a little drop in an otherwise upward streak, to hold on and hope it gets better. But you never know when your luck will change, and telling a minor blip from a huge drop takes a lot of knowledge and experience.
The key to success with Forex trading, and the biggest mistake you can make, is not knowing what your doing when you start. This may seem insulting, but the fact is that no matter how much you know, you can never be fully prepared for the experience until you actually do it. No matter how many books you read or courses you take, trading for real is always harder than you expect it to be.
Maybe you think paper trading will prepare you, and it certainly will teach you a lot, but not enough to succeed. As I'm sure you know from other experience, doing the real thing is never quite like a simulation, no matter how close. Just the fact that you are using real money completely changes the nature of the game.
No, the only way to do well in Forex trading right off the bat is to have help. The best, of course, would be a mentor who you know is already making good money from it, because then you know what they are doing. If not a person to help you, then you need something else to guide you through your initial trading. Books can only take you so far, and until you have a fair number of trades under your belt you'll still be at risk of missing things a more experienced trader would have caught. With this much leverage at stake, you really can't afford to learn from experience. Books can tell you how to find a broker, how to get started trading, what to watch for... but they can never tell you how to make your decisions, for instance, whether you should stay with it during a downturn, or pull out. Or more importantly, when you should stop as it's going up.
Books can tell you a lot of the things you need to know, particularly technical details, but there's always something left out. No matter how much you study, nothing can capture just what it is like to really do it. To have the best chance of success possible, you need expert advice, or a good system.
Because there is only so much money in the world, a trader can only win as much as another trader loses. This is known as a zero-sum game, because every gain matches a loss. However, after the brokers have taken their cut, the winning trader will have made LESS then the other trader has lost. This makes it a negative sum game, and means the vast majority of people who attempt to trade, end up going broke.
So try and get out when you're winning. It's very tempting, if you take just a little drop in an otherwise upward streak, to hold on and hope it gets better. But you never know when your luck will change, and telling a minor blip from a huge drop takes a lot of knowledge and experience.
The key to success with Forex trading, and the biggest mistake you can make, is not knowing what your doing when you start. This may seem insulting, but the fact is that no matter how much you know, you can never be fully prepared for the experience until you actually do it. No matter how many books you read or courses you take, trading for real is always harder than you expect it to be.
Maybe you think paper trading will prepare you, and it certainly will teach you a lot, but not enough to succeed. As I'm sure you know from other experience, doing the real thing is never quite like a simulation, no matter how close. Just the fact that you are using real money completely changes the nature of the game.
No, the only way to do well in Forex trading right off the bat is to have help. The best, of course, would be a mentor who you know is already making good money from it, because then you know what they are doing. If not a person to help you, then you need something else to guide you through your initial trading. Books can only take you so far, and until you have a fair number of trades under your belt you'll still be at risk of missing things a more experienced trader would have caught. With this much leverage at stake, you really can't afford to learn from experience. Books can tell you how to find a broker, how to get started trading, what to watch for... but they can never tell you how to make your decisions, for instance, whether you should stay with it during a downturn, or pull out. Or more importantly, when you should stop as it's going up.
Books can tell you a lot of the things you need to know, particularly technical details, but there's always something left out. No matter how much you study, nothing can capture just what it is like to really do it. To have the best chance of success possible, you need expert advice, or a good system.
About the Author:
Jacob Tremblay is an experienced stock market trader, who is now working on forex trading. Click here to take a look at his site, where he provides forex training reviews of some of the leading systems.
