How Much You Can Earn On Forex
How much money can you really make trading Forex? There are a lot of websites that claim to double or triple their money every month. However, in practice professional traders return 20-80% a month, so a return of 20-30% is both a realistic and a reasonable expectation. For example, you could spend k or more purchasing a house, and in trading, you can earn 2. You could potentially make 2. The conclusion is simple: Forex has such an incredible potential, that it can broker surpass Real Estate even with minimal risk measures in place.
Happy Friday! This week’s question comes from Martin, who asks: How much money can I make per month trading Forex? Admit it, this is one of the first questions you asked when you entered the Forex market. There’s no shame in it. I certainly wanted to know how much I could make when I started with equities in 2002.
Forex news and analysis. The thing is, it’s a slippery slope. Curiosity is natural. While there’s no harm in asking questions, the answer you receive—and whether or not you dwell on it—can have serious consequences. In today’s post we’re going to discuss how much is too much profit, the proper time horizon for measuring returns, and an alternative method that has served me well. Ready to do this?
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How Much Money Forex Trading
Forget What You’ve Been Told (or Sold) Has someone ever tried to convince you to buy their trading system that promises 10% profit per month? How about 20% or 30% every month? If you have, feel free to a leave a comment below. I would love to hear from you. In case you’re one of those traders and are still confused about the earning potential in the Forex market, forget what you’ve learned thus far. There are no guarantees in this business, only possibilities and probabilities. No matter how good you are, you won’t make 30%, 20% or even 10% profit every month.
Sure, you’ll have a great month now and then, but sustaining those types of gains is not realistic. In my opinion, the people using these kinds of profits as a selling mechanism give this business a bad name. Sometimes in order to move forward, you have to forget what you think you know. This is one of those situations. If you have dreams of, think again. The business of trading is a marathon, not a sprint. It’s a slow incremental process that requires a ton of discipline to succeed, and you can’t have massive profits without the associated risks.
So when someone offers you a system that produces 30% profit every month, they are handing you a ticking time bomb. This brings me to an extremely effective, but somewhat unconventional, way of thinking about earning potential. Put the Trading Process Before Profits If you want to become a consistently profitable trader, you must focus on the process first. I can’t stress this enough. No trader has ever become successful by focusing solely on how much money he or she can make each month. In fact, many traders don’t even have such a goal. I’m more concerned with in a given month than how much I can make.
I know that if I protect my capital and follow the process I’ve laid out for myself, profits will follow. That’s the key here. A race car driver doesn’t hop into their car and focus on nothing but winning the race. Sure, that’s the goal and it inevitably crosses their mind, but their focus is primarily on details like when to brake, how early or late to take each turn, and when to punch the accelerator. They know that it’s the small things that make the difference. If they adhere to the process of good driving that they’ve practiced for years, the win is all but guaranteed. Trading is no different.
Focusing on making 50% profit per month won’t make you a dime. It will, however, put you out of business in a hurry.