How to learn FX trading for beginner and how much time does it take?
Becoming a successful Forex trader is very challenging. While there are many success stories that portray Forex traders that reached their fame in just a short period of time, this doesn’t reflect the reality.
Sure, there are chances that the prices of your purchased currencies increase drastically, leading you to instant success and fortune, but it’s all about chance. While some people get lucky, many don’t. And the consequences are more severe for them.
When it comes to putting time and energy into Forex trading, there are various methods used by traders. Some traders prefer to accumulate knowledge by reading books, guides, and tutorials about Forex and its elements. Some of them even enroll in college to study economics or finances which, as you might know, is a pretty time-consuming process.
On the other hand, there are some traders who go straight to the point and start trading. And while doing so, they usually choose options such as micro accounts that require smaller deposits which, for them, is the fastest way to learn FX. This allows them to have real-life experience, gain valuable knowledge, and not lose a lot of funds. This method can be less lengthy than the previous one, but it still takes some time to get to know the most crucial elements of Forex.
FAQ on how to learn Forex trading
How much money do you need to start trading Forex?
Starting Forex trading is a complex process that can be different for various people. There are people who pursue different methods and options that can be expensive, cheap, and even free.
For example, a Forex trading tutorial can be free when traders use demo accounts. Demo accounts allow traders to use various tools that are incremental to Forex trading, testing them in real life, and acquiring knowledge as a result. And all of that without spending a buck.
However, some traders believe that demo accounts cannot be effective because there’s no risk or reward associated with them. That’s why they opt for either micro, mini, or standard accounts. Micro accounts allow traders to make smaller deposits such as $50 and still trade Forex, while standard accounts ask for much higher sums like $200 and more. Mini accounts are somewhere between the two.
How to learn Forex trading?
Learning Forex trading, just like actually doing it, is a complex process and traders pursue it quite differently. For example, there are some traders who go as far as enrolling in universities and getting a degree in economics. This, in turn, is quite a resource-consuming process that not many people can afford.
More often than not, beginner traders tend to gain theoretical knowledge first by reading various source materials and then going straight to trading Forex. The internet is full of such materials, including online books, guides, tutorials, and guides.
There’s a third category of traders that pursue quite a different method. Instead of acquiring any theoretical knowledge, they go straight with trading and learning various skills along the way. It’s not clear which method is more effective than the other - it’s about testing and seeing, which one works best for you.
How long does it take to learn Forex trading?
Learning Forex trading is very subjective and varies from one trader to another. It also varies in terms of time spent on it. There are people who read up on various materials, be it online or hard printed, in a day and master all the crucial elements of Forex.
But sometimes, people tend to take their time and go easy on it. What is the easy way to learn Forex trading for them? Some of them enroll in the universities to get a degree in economics and that, depending on which degree one is aiming towards, can stretch out from two to four years.
There are also those people who spend no time on theoretical knowledge and go straight with the Forex trading. And for them, it’s all about how easy they can master all the characteristics of foreign exchange and currencies. So, learning Forex can take days, months, or even years, depending on which method one chooses and how they can process new information.
How to make a Forex trading plan?
When starting a career as a Forex trader, people usually make some sort of a plan that covers various aspects of this sector. Usually, what beginner traders tend to do, is get a basic trading FX tutorial first, understand what its main aspects are, and how it works.
Then, they decide which currency pair they want to buy. There’s one important aspect to mention here: some currency pairs like EUR/USD are more stable and secure than others. On the other hand, the latter have potentially bigger payouts because dramatic changes in exchange rates are more common for them.
After choosing a currency pair, traders tend to decide their overall budget and how much they’ll be using for individual lots. Here, they choose between demo (if they want to trade virtually), micro, mini, or standard accounts, depending on how much of their funds they are going to spend on Forex trading.
And then, after these basic steps are done, they go on with trading itself. Of course, there are other methods and plan structures to be used. Developing the best plan is usually possible by testing all of them.
How to trade Forex for free?
In Forex, or in any other trading market, there are various methods of minimizing risks and through a Forex trade guide, gain knowledge and experience. And in this sense, probably the most popular method is going for a demo account.
Demo accounts are offered by many financial exchanges and more often than not, opening a demo account is a very simple process. And when it comes to actually operating it, there aren’t many difficulties associated with it.
Demo accounts work like the standard live accounts - they have pips, charts, prices, etc. And more importantly, traders can buy any currency pair that they prefer - virtually, of course. And that’s the difference: demo accounts have no deposit requirements at the beginning or real payouts in the end.
Is Forex trading profitable?
The biggest reason why people want to start reading an FX guide and begin trading is that it can have a profitable payout. There are many stories of Forex traders becoming rich in an instant and that captivates people; it makes them want to do the same and become successful.
But there’s a hidden threat here: while trading Forex is certainly profitable and has high payouts, it’s worth noting that without experience and knowledge, the chances of financial failure are more realistic than of success.
And even if one manages to gain knowledge, the risk doesn’t go away completely. This goes to show that yes, trading Forex can bring larger returns to your financial exchange but you need to be aware of risks and setbacks associated with it as well.