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Spend just a few minutes online, and you’re likely to see at least a few articles about foreign exchange trading. Most describe how everyday people work from home a few hours per day, buying and selling currencies for profit. While some of the claims can be outlandish and exaggerated, there is some truth to the statements. How can prospective forex (FX) investors, traders, and speculators get the facts about how to get started, whether it’s really possible to earn a decent living as an FX practitioner, and how much income is realistically possible? All it takes is a bit of exploration into the topic in order to get the necessary information.
After that, you can decide for yourself based on verifiable information. A popular way for many to experiment is to open a demo account with an online broker and try their hand at forex transactions. It’s essential to walk through a few basic steps like learning how to get started, knowing how to choose a reliable broker, locating a no-cost signal provider, exploring copy trading, and more. By taking wise precautions and avoiding scams, prospective traders can shield themselves from most of the potential challenges that come with a venture into any of the markets.
How to Get Started
All you really need is a working computer and decent mathematical abilities. Other than that, it helps if you can spare a few hours per week to learn the basics and have a small amount of investment capital. Those who start their online forex trading with AvaTrade can take care of a brief application and get set up in a matter of minutes. Transferring funds is also a quick detail for new account holders. Your potential earnings are closely tied to the amount of funding you can pony up for a new account with an online broker.
Why? Because if you start very small, it could take several months to reach returns that are at least paying you for the time you devote to the pursuit. Depending on where you live and how much you earn, a good guideline is to open with the equivalent of one or two weeks’ wages. From there, it’s possible to build up the amount relatively quickly. Note, the growth is assuming that you do everything right and by the book. That entails making very small transactions and following a careful course of money management along the way. It takes discipline and persistence to succeed in FX trading. The good news is that almost anyone can do it.
Select a Broker
Choosing a broker is a much more important part of the success puzzle than people realize. That’s because online brokerage firms vary in quality by a wide range. The simplest way to protect yourself is to work with a well-known, reputable company that has been around for a few years and welcomes new traders. Some firms are a bit elitist in the way they discourage newcomers. Opting for an online service provider that caters to first-time investors and trading enthusiasts is a crucial step. It’s equally wise to select a platform that offers demo accounts. That way, you can practice the mechanics of buying and selling before putting your own money on the line.
Find a Free Signal Provider
Take an hour or so to shop for a free signal provider. This is a great way to risk no money yet receive a few no-cost suggestions from more experienced traders. Be aware that the majority of freebies are offered to entice you into purchasing a premium subscription. Stick to your goal of only using the free signals. Use them within a demo account with your chosen broker to test their validity and reliability. New traders are often surprised to discover that a good number of the free signals are relatively accurate.
Be careful about the size of the positions you take. That’s a forex way of saying that you should not spend too much money on any given trade. For a huge number of experienced practitioners, the 1% rule is a way of life. They never place more than that much capital into a single transaction based on their total account size.
Scams to Avoid
Beware of online sellers who promise unrealistic winning percentages and attempt to convince you to join their monthly subscription service. They usually offer signals that can’t miss or are verified correct 90% of the time. It’s simply an attempt to separate you from money that would be better spent making informed, careful trades. Choose a reputable broker and study their educational materials to sharpen your skills.