Is Forex Trading right for me?
When people first hear about Forex Trading they fall in love with the idea of being a successful trader.
They fall in love with the idea of being able to work from home and only working a couple of hours a week.
They fall in love with the idea of making easy money. They fall in love with the idea of being an investor like the ones they’ve seen in the movies.
If you have fallen in love with Forex Trading due to any of the above reasons, then you have been lied to!
There are thousands of sharks out there trying to scam people by spreading unrealistic promises about trading.
Do you want to find out whether you have what it takes to be a successful trader? Then this article is for you. We do not intend to sugar coat any of the info in this article so buckle up.
Can you handle the truth…?
Forex Trading is not easy! Forex Trading is not a quick way to make money!
Oops! That wasn’t what you were hoping to hear right? Well, that is the reality. So many people are scammed to think that trading is as easy as pressing a button and making money.
It just isn’t true. Forex trading is probably one of the hardest things that we have ever done and ever tried to do. Don’t believe the lies that people try to sell to you regarding trading.
If it sounds too good to be true then it probably is!
Do not be fooled by the fake stories you hear of beginner traders making thousands of dollars a day. There are professional fund managers who indeed make thousands of dollars a day.
However, the professionals that achieve that level of trading have hundreds of thousands of dollars under management. Don’t think that starting out as a beginner you will be anywhere even remotely close to that.
The truth is, Forex trading is much harder than most people realize. Majority of beginner traders we talk to think trading is a walk in the park.
Trading is a very challenging endeavor. That is a good thing though, because if it was easy then everybody would be doing it…
Trading takes Discipline
Discipline is very important for a successful career in trading. The reason for this is because trading is an exceptionally challenging endeavor.
Without discipline a person will not be able to succeed as a trader. Why is discipline so important in Forex Trading? Discipline is required in trading for three reasons:
1 ] Without Discipline, a trader can become reckless. A reckless trader is gambling, not trading.
Being able to manage your risk is absolutely crucial in trading. Discipline will make sure that a trader sticks to proper risk management and keep their accounts safe.
Remember, preserving your capital is just as important as growing it. If you are a reckless gambler with no discipline you will without a doubt eventually bust your account.
Disciplined traders learn to protect their accounts against excessive draw-downs. Disciplined traders does not over-leverage their accounts.
2 ] Without discipline, traders will not be able to overcome the strenuous psychological roadblocks traders face in trading.
Traders face a wide range of emotions in their trading. Emotions ranging from fear to greed to euphoria just to name a few.
It takes discipline to systematically face these emotions and learn to manage them. If a person lacks discipline, their emotions will always get the better of them.
2 ] Without discipline, traders will not be able to cultivate the PATIENCE required to trade successfully.
Patience is a very important part of a successful trader’s toolkit. A lot of beginner traders don’t realize how important patience is in trading.
You will need patience to make sure you WAIT for the very best trades. Patience, through discipline, will make sure that you only take high quality and high probability trades.
That type of patience means that you would rather stay out of the market than risk money unnecessarily. You see, sometimes it takes more patience NOT to trade.
There is nothing wrong with staying out of the market when you don’t see any clear trading opportunities.
Don’t fall into the classic beginner trap of thinking you must constantly be in trades every second of the week.
Knowing when not to trade often separates good traders from really great traders.
If you are a disciplined individual then Forex Trading will suit you well.
Trading shares similarities to any career out there. You cannot expect to be an expert in any career without gaining experience.
Some beginner traders think they will be trading like the pros after two months of trading. It just isn’t that simple or that easy.
There is no such thing as overnight success in trading.
Gaining the experience and expertise required to trade successfully will take lots of time and commitment.
Trading will require more commitment than most people are willing to give. There will be times in trading when you will want to give up.
There will be times that you will question whether you should continue trading. This is where commitment is critical to your success as a trader.
It will take lots of hard work and many months of studying and practicing.
If you want to trade Forex as a hobby you will most probably not be successful. Hobbies are things we do when it is convenient.
Commitment means doing something even when it is not convenient. Successful traders are fully committed to their goals of trading consistently profitable. No excuses.
The thought of being able to work from home is very exciting for many people.
However, not everybody has the right personality to work from home.
When your office is just a few steps away from bed it can make getting up a bit more challenging sometimes.
Will your personality be able to deal with the risk involved in Forex Trading? As a retail trader you carry the full risk and responsibility for your trading account.
Any wrong calculation on your part can cause you to lose large amounts of capital in a matter of seconds. Not many people can deal with that type of risk and responsibility.
Forex trading involves RISK. By necessity, you are taking a risk every single time you take a position in the market. You risk losing all the money you trade with.
For most people, that type of stress is just too much too handle.
The type of risk taking that traders are exposed to is definitely not for everyone.
Another reason why the right personality is required in FX trading is because trading can be a very lonely business. You are all alone in your study in front of your screens for the entire day.
The only things that keep you company is the charts and the news squawks in the background.
Most people will not be able to sit in front of their desk and stare at screens for the entire day…
Trading successfully will require a lot of screen time and lots of time researching for possible trading opportunities. If you don’t like sitting at a desk all day long then trading might not be the choice for you.
Another personality trait of a good trader is someone that can admit when they are wrong. This might sound silly but I assure you it’s not.
A major difference between good traders and truly great traders are the way they take their losses.
Trading will be a very costly career for someone who cannot admit when they are wrong and move on from losing trades.
What does that have to do about trading you may ask? Well, traders will always make mistakes in the market. The market is driven by emotion, and thus won’t always move rationally.
Traders who can’t take a loss on the chin and move on face the danger of taking revenge trades…that is a recipe for disaster.
Make sure that you are able to take your losses on the chin and move on to the next trade.
There is lots to be said about motivation in trading. However, motivation is not something that is a requirement for success in trading alone. It is also required for success in most areas of our lives.
The motivation or the reason why you do things are incredibly important. Your motivation for wanting to trade Forex needs to be more than just making money.
If the reason behind your desire to trade Forex is shallow, then your will power to make it work will be shallow as well.
Remember, trading puts a lot of strain on you psychologically. Thus, your motivation for trading should be based on something that is really very important to you.
You need to be motivated by more than just money. When things are going great you don’t always need motivation.
However, when the market is moving against you and you have losing streaks you will need motivation to keep going.
It is in those tough times that your motivation will grant you the stamina to keep going. When the trading gets tough, the motivation keeps us going.
So do you have what it takes to be a successful trader? Only you can answer that question at the end of the day.
Given all the information in this article it should be clear by now that trading is definitely not for everyone. Make sure you have what it takes before you risk real money in the market.
Trading can be a very lucrative and exciting way to earn a living. However, reaching that point will take a lot more time, focus and energy than most people realize.
There are so many people out there that are interested in trading for a living. However, very few people possess what it takes to make it as a successful trader.
Finally, always be careful of scammers who promise you overnight riches in trading!
If it sounds too good to be true then it probably is!
If you found this article helpful, feel free to check out the rest of our articles on our website.
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