26 August 2013
Can Forex Trading Make You or Break You?
During these days of recession everybody is looking for ways of making money.
Some are looking for part time jobs to increase their income and others want to start some small business.
Not many people know that forex Market offers opportunities to everybody. forex trading can Make you as well as Break you if you don't know how to trade.
To make money through Forex you need to first learn how its done. You can buy many forex trading Courses on Ebay as well as online but it costs money and many of us are reluctant to part away with our hard earned money.
Luckily Dr. Zain Agha has written a 7 part Forex Trading Course and he has been giving it away for free to those who are really serious about entering the Forex World. You can get it for free from his website. Search on Google for Luckytips and you will find his website. Just fill in your name and email address and then you will receive an email asking you to activate your account. Once you click the link to activate your account, you become an Opt-in Member. You will be sent a 147 page ebook on Forex Trading plus you will receive one part daily of the 7 part Forex Trading Course for the next 7 days.
Now lets come to the crunch. Why I say Forex Trading can Make you or Break you. You must think seriously before entering the Forex World.
Here are the Pros and Cons For and Against Forex Trading.
Why should you Trade Forex.
This is the most Attractive Home Business.
What is so attractive about Forex Trading you may ask.
You can make big money working only a few hours a day on your computer.
You can trade from anywhere. If you like to travel, this is a Dream Business. Take your laptop with you and you can trade the FOREX and make money anywhere in the world where you have an internet connection.
You can make money when the market is going up or down.
Start-up costs are low. Forex offers up to 100:1 leverage.
No need for Staff. No Inventories. No Hassle.
Forex is the world’s largest market with a trading volume of around $1.9 trillion dollars a day.
The Money is Out There. All you need to grab it is to know How To.
and the How To, you need to learn a Method and stick to it.
How can Forex Trading Break you.
This is the main purpose of writing this article to warn the Naive people who think Forex is like a Garden with trees growing Currency notes instead of leaves and all we need to do is to pick some leaves/money everyday and become Millionaires within a few months.
This is what most Forex Gurus make you believe in. But in reality its not like that at all. Although Forex Market is a very lucrative Home Based Business but we as humans have emotions and it is very difficult for us to control our emotions. Because of our Emotions we lose money. 95% of the Traders lose their money. Forex Trading is so addictive that once you are in it, it will become very difficult to get out of it.
The Emotions that come into play are FEAR and GREED.
Here are some examples of what happens when you are in a trade.
You buy a Security, the price goes up, instead of taking the profit you think the market will go up further, it does go up a little and you tell yourself you are a Genius, you forecasted right, the market will still go up and it went up.
Now instead of taking the profit now, you become more Greedy and say to yourself, the market will go further up and you will make more money but the market starts retracing and going down, you say, no problem let it go down, its taking a breather, the market is correcting itself and it will come back up.
But the market continues going down, you dont know that some adverse news came up and the Market started falling. Now you start losing as the market keeps going down. it continues down and down, you panic and get out of the Market with a loss.
This is one way one loses money by being Greedy.
The second emotions we cannot control is FEAR.
Here is a Scenario.
I buy a Security thinking it will go up and even the system that I have tells me to buy. OK I buy, the market starts going down and down, I panic and exit with a loss, fearing of further loss, only to find that the market actually started going back up and had I stayed in the Market I would have made some good money.
But because of my Fear of losing, I in reality did lose
So the Emotions play a big part in once Success.
One more reason why most people lose.
There is a vast majority of traders who do realise that Emotions are the cause of our losses and they need Robots to trade for them as Robots are computer programmed softwares that do not use emotions.
And there are thousands of Robots in the Market. Every week we see at least 2 to 3 new Robots coming out and promising of making Vast sums of money for us. All we need to do is buy it for $97.00 and make Millions..
These Robots do make money initially for a few days or weeks and then comes a time when the market never retraces once we are losing and the losses keep increasing with time.
Most of the Robots do not have a Stop Loss built in and those that do, have stops of 1000 pips. That means if the trade goes against you, your account will either get wiped out or you will lose $10,000.00 in just one day.
This happened to me personally. During my early days of trading I purchased a Robot that was making me $200.00 about 3 to 5 times a day. I started trusting that Robot and stopped monitoring the trades. I went out one day to do some shopping and when I returned I noticed that I am losing more than $8000.00
And this was my Live Account with Real Money.
Since that day I never took Automatic trading seriously.
I did purchase a few Robots and put them to Test by Demo Trading and found that eventually one day it takes off you more than what it gave you.
Sorry Robots are not for me.
These are the pros a cons and now you have to decide, would you like to become a Forex Trader?
A word of Warning:
If you do decide to become a Forex Trader, first Demo Trade for at least 2 months with fictitious money and only then open a live account with real money that you can afford to lose. Never use the money that you have saved for your retirement or for any other purpose.
Wish you best of Luck,