The quote is often said that the easiest way to get $1,000 in forex is to start with $5,000. This is obviously a humorous quote, but points to a large issue that is not a joke. More than half of forex traders lose money. Many of them lost significant amounts of money.
I am not saying that it isn’t possible to make money trading forex. In fact, plenty of people manage to make a consistent income trading forex on a daily basis.
The fallacy is that it is easy money. Typically when someone signs up to start trading forex they do so under the false illusion that it is an easy way to make money. They are sold on expensive courses that feature rich millionaires in their yachts talking about how they do no work but make lots of money.
That very well may be so. But it is highly doubtful that those same rich millionaires weren’t working their butts off at some point in their life. It is also highly likely that those millionaires have lost huge amounts of money while learning how to succeed in what they do. That is the nature of the game.
So back to the original point. The lifecycle of a typical forex beginner looks something like these steps.
- Get excited by a course that promises quick money and easy living.
- Sign up for a forex broker without ever doing any further research
- Blow through a large amount of money in a short amount of days
- Conclude forex is a scam and no one makes money
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Meanwhile the top forex traders are using tried and true systems that they slowly developed or learned through much trial and error, and are making consistent profits every single day.
The different is really the difference between any successful and unsuccessful person. Those people that are ultimately successful have typically tried a million things and lost a lot of money and time in the process. The only way they were able to discover something profitable that worked for them was by trying things over and over again that didn’t work until they found something that did.
Sure, they aren’t out there preaching about all of their failed systems and all the times they lost money, but who would be?
If I were to start over trading in financial markets with no knowledge there are a few key places I would start.
First I would start reading books. Books give the theory behind trading in financial markets, and understanding the theory is key to successful long-term trading.
Second I would join every Facebook group or Reddit thread that talked about forex. Then I would ask questions constantly in those groups. I would be respectful and try to help out answering any questions that I could to those that knew even less than me.
Finally I would find people I trust and ask them for reputable brokers and courses that I could take. This one is probably the biggest key. There are probably hundreds of forex courses online that guarantee you a system that will make you money from day one. As with anything of that nature, a lot of them are scams. They are taught by people that learned how to trade forex, couldn’t succeed at it, and ended up just selling courses to make money.
Other courses are taught by legitimate traders with great systems for making money and willingness to help out those that aren’t as far a long as they are. Finding these courses requires finding people you trust who have no ulterior motives and learning from them.
So in conclusion, yes people make money on forex. People also lose money on forex. The difference is a mindset. People that make money understand forex is a business and a hard one at that. They don’t have an easy money mentality. They overcome failures and eventually win.