Forex Trading

Submitted by: Winsor AGA Hoang

It takes twelve years of discipline to come a doctor, eight years of schooling to become a lawyer and five years of extensive training to become an engineer. However, most people think that they can become good traders by taking one or two trading courses or by taking several winning trades in the Forex market.

Forex currency trading is complex and is extremely demanding! Most retail traders fail 80-90% of the times in their venture. All traders try to make large sums of money using the high leverage provided by the brokers. Leverage is a double edge sword where you can make a lot of money quickly, or you can lose a lot of money even quicker. Many new traders lose their initial investment within the first two month trading and in most case struggle to win the lost money back, by investing more. Trading without proper techniques and money management is similar to gambling. Think about a new doctor, he may have the education training but still requires two years of residency. Most traders lack the education, patient, and neglect the rules of money management.

Most traders who enter the Forex market are being drawn to the promise and hope of easy money. They are drawn by small starting capital and yet the being able to trade large amount of money due to enormous leverage offered by the industry. Novice traders trade without any kind of effective trading plan, and they may be pushed by their instructors to open real trading account using their instructors as introducing brokers. Most of the traders have no proper idea about good trading software, how to use the charts, or perform a detailed technical analysis of the currency pair they are trading. Novice traders should not be opening real account after one or two years of demo trading and many practicing trades. During the demo trading period, it is recommended that notice traders should follow automated trading software in parallel. A good trading software is the one that completely focuses on risk management, and is simple to operate and easy to understand by even an inexperienced trader.

Whether it is a novice trader, or any experienced person trading in Forex market, they would make basic money management mistakes, and it is here that they fall miserably. Many-a-times the retail traders make emotional attachment to their trades resulting into large losses. And this happens more with the novice traders who lack the experience of controlling their greed, fear and disciplines. After experiencing regular bouts of loss, new traders ultimately lose the interest, and finally give up.

In the attractive sounding Forex Market, things are not easy as they seemed. Sudden changes create the windfall or downfall for the retail traders. A trader can make easy and huge gains in a short period of time, but it is his consistence performance over six to twelve months that will determines his success. This fundamental also applies to Forex trading software and managed Forex accounts using manual trading or automated trading. All trading systems must be followed for at least six months before committing further investment. If you assume that Forex trading experience can be accumulated in a few months with several trading courses or real time trading chat rooms, it will be a hard learned lesson. It is after six to twelve months that everything begins to go topsy-turvy.

The trick is to understand that the trading profession will requires at least four years of experience before you can generate profits consistently. During the meantime, use the automated trading software in parallel to earn you some income.

About the Author: About the author: Registered Professional Engineer Winsor A.G.A. Hoang, Founder of Winsor Global Financial Inc.

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He is the developer 5 Forex trading systems for auto trading. His automated software is internationally ranked with live trading results published every 30 minutes.

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Consider the fact that Forex traders are stating returns on their investment as high as 50 to 70 per cent to understand why so many people are interested in the field. Exciting, informative, challenging and well paying, a Forex trading system is ideal for people who have the right mindset to play big and careful. Since there is no limit about the minimum investment for small players, this field attracts investors of all types many of who move out after burning their fingers. The committed ones try different strategies and continue and earn to make it big and avoid scams.

Practice sessions

For the cautious, there are vendors of Forex trading system who allow a future customer to try a hand at trading and seeing the possible returns before deciding to commit to this mode of work. When you try these schemes, keep an eye out for different schemes that make claims of huge returns. Weigh the returns you have made with these claims and find out how it is possible for such high returns to happen.

Expected returns

Regardless of what many others say, a Forex trading system that provides you with returns that are higher than the current rate on a fixed deposit or an equity investment can be considered good. Though there are claims of huge returns, most of these happen with big traders who are associated with large brokers or banks. They make it their life business to be in touch with the rates of their currencies and do not need to depend on external sources of information. So, if you are a small trader, if you have a windfall gain, count that as a one-off situation and continue.

Scams To Be Aware Of

Big scams have offered returns in the range of 100% and above to gullible players in Forex trading system. It helps to know that in this field when one trader makes a profit, it is at the cost of another trader’s. Another type of scam occurs when a large broker puts forth a high returns promise to investors. Even if the amount to be invested is $100, if thousands of people go ahead and enrol for this type of offer, the broker is at a huge profit. Go through the background of how earlier scams have worked and be cautious of unnatural claims.

Avoiding Scams

When you are told to send money or invest upfront, step back from the Forex trading system that you are in touch with. Unscrupulous brokers are able to attract investments with schemes that sound too good to be true. They promise higher than normal returns and are able to hoodwink people with their claims. Though it is possible you come across such people in the course of your work, continue the conversation but do not send any money. When a small investment is promising you whopping returns in a short time frame, keep away from it. Stay within the limit of conservative returns to be able to sustain a long innings in the field.