There are many answers to this question:
Quick, easy, a lot, safely, carefully, professionally…
Which option we choose depends on ourselves and our approach to this profession, our goals and our tolerance to taking risks. Of course, everyone would like to earn money easily, quickly and a lot. The reality is, unfortunately, a bit more complicated. Let’s start with explaining where the possible profit really comes from?
Can you Make Money on Forex?
Profit, as well as loss, is generated by a change in the value of a given instrument, in the case of the forex market it will be a change in the value of two currencies relative to each other. Each currency pair consists of two components: the base currency and the quote currency.
If we open a long (buy) position on the EURUSD pair, it means that we will buy the euro (base currency) for US dollars (the quote currency).
In the event that the euro strengthens against the US dollar, the rate of this instrument will go north and we will earn, while when the euro weakens, the rate will fall and we will lose. What attracts many Forex investors is the ability to make short selling transactions. This means that if we believe that the value of an instrument will decline, we can sell it to buy it back at a better price. In this way, we have the opportunity to earn both on the increases and decreases in the prices of individual financial instruments. I know it sounds irrational because how can you sell something that you don’t have … but that’s what Fx charms are.
There are various ways to make money in Forex. By buying and selling very short currency movements with a range of several or a dozen points and lasting several to several minutes (so-called scalping), buying and selling currency movements during the day (day trading), buying currencies on
holding back by entering fundamental trends (medium and long-term trading), and also as a hedge.
Each of these methods requires a different approach and plan, and the choice often depends on the individual’s predispositions, possibilities and personal conditions. However, earning methods are a very individual matter.
Some people sit in front of the monitor all day trying to score as much profit as possible, while others do their analysis in the evening after work, setting positions for the entire next day. The basic rule here is saying, “Whatever works for you, hold on to it.”
What do i need to earn on FOREX?
To become a trader, you do not need to graduate from specialized schools or do PhDs, but without gaining adequate experience and familiarity with the market, it is almost impossible to earn stable income in the long term.
So let’s consider what exactly is needed to become a Professional Trader:
- computer, tablet or phone that supports the transaction platform,
- necessary for investment,
In general, in the era of computerization and digitization and technological progress, the basic technical and hardware issues necessary to invest in forex have already become common goods and are owned by the vast majority of society.
Therefore, they do not constitute any major obstacle.
In recent years, there has also been a significant development of generally accessible educational bases and materials, thanks to which basic knowledge can be learned free of charge without leaving your home.
There are still two very important issues: experience and capital.
When it comes to financial issues, they depend on our predispositions, savings, tolerance to take risks, although nowadays many brokers offer start-up bonuses that allow you to invest with real funds without or with a small own contribution.
Of course, these are not the amounts that allow you to earn millions, but for a good start, education should be sufficient.
Gaining the necessary experience turns out to be a bit more difficult.
Despite the fact that more and more knowledge is freely available, it takes much longer to acquire and master it in practice. What makes some people profitable traders is their stubbornness and determination. Stable and systematic profits are also helped by a personalized investment strategy, which defines in detail our risk tolerance, the way capital is managed and each individual transaction, investment signals and ways of conducting positions. This is an incredibly complex topic that you can read more about in my previous column where I detailed the 7 steps to building your investment strategy.
In conclusion, it is worth emphasizing that earning on forex is possible and the latest statistics show that more and more people are switching to the “green side of the statement”, so it pays to spend some time gaining experience because, as statistics show, you can earn this way, but about whether ?