Can You Get Rich By Trading Forex? All Forex traders in South Africa and around the world lose some money on some trades. Forex trading is not a get rich quick scheme. 90% of currency traders lose money, mostly due to lack of training, discipline, planning, having poor money management rules and not having a trading edge.
Can Forex Trading Make You Rich?
We are going to be 100% honest with you and tell you the below important things before you consider venturing into trading currencies
- All forex traders including experienced traders lose money on some trades
- Forex is not for people who live on credit or the unemployed
To answer the question if Forex can make you rich is “No and Yes”…let’s qualify our response. If you are a hedge fund with deep pockets Forex trading can make you rich. However, for Forex trading beginners or the average retail trader, it won’t be an easy road to riches. Forex trading can result in huge losses and potential impoverishment.
How Much Money Do I Need to Start Trading Forex?
Although some Forex brokers in South Africa will let you start trading currencies from as little as $100, you will need to deposit at least $250 with a broker in order to start day trading. However, if you really want to become rich by trading Forex, you need at least $10 000 of trading capital that you can afford to lose in a mini account.
Don’t expect to start Trading forex with $1 000 and expect to become an instant millionaire over night. Forex trading is the world’s largest and most liquid market with a daily volume of $6 trillion traded everyday.
With this amount, you would assume Forex traders make a killing in the foreign exchange market, but success has been limited to a very small percentage of forex traders especially in South Africa.
Why Most Traders Don’t Become Rich by Trading Currencies?
You have to understand that Trading Forex is a skill that takes time to learn. The problem with some South African forex traders come with the misguided hope of making millions and hyping on social media. However, in reality, these traders don’t have discipline and are not prepared to learn the art of trading.
All traders must have enough information before deciding on joining Forex. Also, a proper trading strategy is key. Forex is not gambling, there’s no shortcuts to Forex.
What Must I Do to Become Prepared for Forex Trading?
Come to think of it, if the whole world was trading, everyone would be a millionaire now. Trading forex is not a piece of cake or a walk in the park. Seasoned day traders (skilled traders) can and do make money through Forex. However, skilled traders with years of experience can hit rough patches and experience losses.
Just like in any field, to make it in Forex, it takes lots of practice and experience to master this field.
You can practice Trading Forex using a demo account for free using fake money. Once you feel confident and know inside and out, you can then create a real Forex trading account and start making trades.
Image Courtesy: admiralmarkets.com
Zita Zimande is a sports news journalist from the University of Johannesburg. Besides being a sports fanatic, she loves to cook during her spare time.