Many traders are drawn totheforeign exchange market when they see promises ofmassive returns. Have you seen advertisem*nts forsystems which can double your account inaweek? Orgive you returns of1000%? Thepeople who promote these systems say that they work because with Forex you are allowed totrade using leverage — meaning you can control substantially more money than you actually have, andcollect theprofits from those massive trades. Ofcourse, what these
Thereality ofForex is that while leverage is available, most successful traders use it sparingly ornot atall. Themajority oftraders who actually make it will only invest something like 2.5% to5% oftheir accounts onany given trade. That is apretty small percentage oftheir bankrolls. How many trades you take inagiven week ormonth andhow successful those trades are will determine how much money you can actually make inagiven time period. Most really good currency traders are pleased if they can pull in5% to10% returns per month!
Does that mean you cannot make more than that? It does not, but you have tobe careful how you go about it. You could bring in1000% returns inaweek with alucky gamble after all — andthen lose 1000% thenext week andbe out ofthegame. Would you rather make huge returns foraweek ortwo andthen go broke, ormake smaller but consistent profits which will add up over along time frame? You cannot build aliving onwild speculation, but you can build aliving off ofconsistency inFX trading.
So how can you increase your earnings without gambling? One way would be totake more trades. You cannot compromise ontheintegrity ofthose trades, however — they need toall be
Forex takes agreat deal ofpatience, unless you are coming into it with amassive bankroll already, inwhich case you should be perfectly happy with 5% to10% monthly anyway. Remember that there is theoretically anexponential growth curve if you can stick with this forthelong term, but only if you can pull inconsistent profits. So work onthat 5% to10%, andknow that your patience anddiligence are going topay off foryou inthelong run. If you feel theneed toaccelerate things, then concentrate onfunding your account — not compromising your discipline.
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