How difficult is it to make money trading the Forex market? How much
time does it take to actually be able to make a living trading the
Forex market? These and other important aspects of trading are to be
discussed in this article.
Trading the Forex market has many benefits over other financial
markets, among the most important are: superior liquidity, 24hrs
market, better execution, and others. Traders and investor see the
Forex market as a new speculation or diversifying opportunity because
of these benefits. Does this mean that it is easy to make money trading
the Forex Market? Not at all.
Forex brokers agree that 90% of traders end up losing money, 5% of
traders end up at break even and only 5% of them achieve consistent
profitable results. With these statistics shown, I don’t consider
trading to be an easy task. But, is it harder to master any other
endeavor? I don’t think so, consider musicians, writers, or even other
businesses, the success rates are about the same, there are a whole
bunch of them who never got to the top.
Now that we know it is not easy to achieve consistent profitable
results, a must question would be, Why is it that some traders succeed
while others fail to trade successfully in the Forex market? There is
no hard answer to this question, or a recipe to follow to achieve
consistent profitable results. What we do know is that traders that
reach the top think different. That’s right, they don’t follow the
crowd, they are an independent part of the crowd.
A few things that separate the top traders from the rest are:
Education: They are very well educated in the matter; they have chosen
to learn every single and important aspect of trading. The best traders
know that every trade is a learning experience. They approach the Forex
market with humility, otherwise the market will prove them wrong.
Forex trading system: Top traders have a Forex trading system. They
have the discipline to follow it rigorously, because they know that
only the trades that are signaled by their system have a greater rate
of success.
Price behavior: They have incorporated price behavior into their trading systems. They know price action has the last word.
Money management: Avoiding the risk of ruin is a primary subject to the
best traders. After all, you cannot succeed without funds in your
trading account.
Trading psychology: They are aware of every psychological issue that
affects the decisions made by traders. They have accepted the fact that
every individual trade has two probable outcomes, not just the winning
side.
These are, among others, the most important factors that influence the success rate of Forex traders.
We know now that it is not easy to make money trading the Forex market,
but it is possible. We also discussed the most important factors that
influence the rate of success of Forex traders. But, how much time does
it take to have consistent profitable results? It is different from
trader to trader. For some, it could take a life time, and still don’t
get the desired results, for some others, a few years are enough to get
consistent profitable results. The answer to this question may vary,
but what I want to make clear here is that trading successfully is a
process, it’s not something you can do in a short period of time.
Trading successfully is no easy task; it is a process and could take
years to achieve the desired results. There are a few things though
every trader should take in consideration that could accelerate the
process: having a trading system, using money management, education,
being aware of psychological issues, discipline to follow your trading
system and your trading plan, and others.
