Are you looking for a way to make money fast and easy? Forex trading is one of the ways you can make money easily. What rules should a trader follow be successful? Are there guidelines that one needs to follow so as to establish a solid foundation in Forex business? What should one consider before they start trading?
The truth is that a trader has never been successful by attending a course or reading a book but by following simple rules that are easy to master and implement. You should have in mind that Rome was never built in a day therefore it will take time before you are perfect at this trade. All you need is proper guidance, special expertise and fully functional tools to be successful.
Here are best 10 basic rules that will ensure that you will hit the ground running if you are a beginner.
1. Mind Set- having a proper mind set is the most basic requirement for a trader. One you decide to join Forex trading, you should make it clear that you cannot earn large profits in a single day. You should not expect to make a million in a couple of months. But as time passes by, you will get better and better until you are perfect at Forex trading.
2. Patience- patience is a virtue that a trader needs to have. You should not rush to decisions as they may prove to be too costly in the long run. Being patient leads to consistency hence you will be able to learn fast on the trading strategies.
3. Start with a virtual trade account- initially set up a Forex demo account with the Forex software company. Demo Forex account will help you get a grasp on what this kind of trading entails. You will be able to practice your skills without having to get involved with real money hence you will not lose anything being unprofessional.
4. Find a reliable broker- make sure that the broker you open your virtual account with is reliable. Forex trading software platform like MetaTrader is well known for its reliability. You will be able to get a real picture on how real trading looks like.
5. Start trading virtually – this way you will be able to practice as much as you want. You will have the chance to explore all services and features of the trading software. You can also do trade on a single channel. You will be able to learn different strategies and by practicing over and over again, you will be able to get them in your fingertips. To trade you need to look for a menu button named BUY/SELL an in no time you will be trading.
6. Switching to premium- after you feel that you have learned and practiced your Forex strategies, you must switch to premium account. You should make this switch when you are mentally ready to enter the real Forex market with your own capital. You should ensure that you have mastered all the techniques, strategies and you are equipped with all the necessary tools.
7. Size of your account- Having a bigger account with your broker will enable to put more on each trade. As a beginner, you should start with a small account and grow it as your level of confidence and competence increases. You should minimize the amount you put in and let your successful trade drive your business.
8. Amount to risk- This is the amount you are willing to risk in a single trade. At maximum, it is advisable that this amount should not be more than 5% of your account. The optimum amount to risk in a single trade is 1%. If you are a beginner, you should not attempt to run multiple trades at once.
9. Size of stop loss – you should use your stop loss to determine how much you will place per trade. If for instance 5% of your account is 50 dollars, you can set yourself a stop loss of 25 pips; the amount you will place per pip will therefore be 50/25 which is equivalent to 2 dollars per pip.
10. Set yourself a target- you should not measure your success on the amount you make but it should be based on fixed number of pips and increasing profits on a placed pip. If you desire to make 100 dollars, euro, pound or any other currency per day, it is easier to look for a growth of 100 pips at a dollar per pip.
By adopting these guidelines, you will be able to lay yourself a solid foundation for becoming a successful trader.