You have come to the right place if you are looking to set up your own forex trading business from home.
ALSO READ: How to Open a Forex Trading Account in South Africa
The purpose of this article is to teach you how to make money online by trading currency pairs. Trading online for beginners is necessary because as a beginner, you must be aware of the basics because it involves some amount of risk. However, rest assured, we are here to teach you about what is forex trading and how does it work. You can earn an income in an interesting manner.
Currencies worth more than $5.3 trillion US dollar are traded on a daily basis in the forex market. You know what it means? It means that there’s a possibility for you to make profit through an online forex trading business without risking a huge amount of your hard-earned money. One of the advantages of foreign exchange is that you don’t need to meet any formal requirements for starting a currency trading business.
Advantages of online forex trading
- The forex market operates round the clock unlike the stock market
- The forex allows margin trading, meaning you can buy currencies worth thousand rand (ZAR) even if you have less than R5 000. In stock trading, this is not possible to do this
- You cannot manipulate the forex market
With that being said, all you need is to have at least $100 to create an account, patience, internet connection and a computer or smartphone to become a forex trader. Below are some of the steps you can follow to start your forex trading from home:
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Organize the trading capital
The good news is that you are not required to have a huge amount of money to start online currency trading because most of the South African forex brokers offer the margin trading feature. Brokers such as XM Trading require you to have at least $5 while others need at least $10 for you to set up a forex trading account. You open an account on the platform offered by the broker and you can utilize no-deposit bonus option to start trading online. But it is advisable for beginners to have at least $1 000 to start trading, as this will make sure you last longer if it happens you encounter losses.
2. Learn the basics of currency trading
Learning forex trading on your own is not easy even if you are watching forex tutorials on YouTube. Brokers recommend that you work with an expert to learn the basics of currency trading. You can also attend webinars or seminars and read trading books to sharpen your skills. South African brokers such as FXTM and Just Forex are best known for holding seminars across the country. Reading business and economics books will also help you expand your insight, more especially fundamental analysis readings. Also, you need to mater technical analysis.
3. Choose a reliable SA forex broker
To help you access the forex market and trade, brokers provide online platforms. It is recommended that you go through the trading terms before choosing a broker. In order to achieve your financial goals, you need to work with the right broker.
Compare the brokers and their features before opening an account with them. Some of the things to consider include terms and conditions, trading options and user reviews. After this, you should be able to choose a broker that meets your needs. For this purpose, you can also consult with an expert trader.
4. Open a demo account
After deciding on which forex broker you will sign up an account with, open a demo account on their platform. The demo account is free and has a time limit. But it gives you an idea as to how to utilize the online trading platform offered by the forex broker. The virtual account also prepares you for real money platform. This means that when using the demo account, you won’t lose any money because you are trading with fake money on the platform.
5. Practice, practice and practice
You cannot learn forex trading while walking. You need to sit down and extensively train yourself so that you know when is the right time to buy and sell currencies. Trade on the demo account for a few weeks before trading on the real account. This will help you decrease the changes of incurring losses.
With a demo account, you can implement different trading strategies and develop your own trading style.
6. Start forex trading with real money on a live account
The final step is to open a live trading account with the South African broker. Create a live account once you feel like you have practiced enough. Deposit the minimum amount required by the broker and start trading.
Watch the below Ref Wayne’s interview at SABC
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