My Foray Into Forex Investing
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What it takes to be a successful forex investor…
"Forex is very risky!" "You'll lose everything you have!"
Most of the comments I hear about foreign exchange investing (forex in short) run along these lines. So much so, I never even considered forex as an asset class till I met a forex trainer in the course of my business. He impressed me enough that I ended up paying a few thousand dollars for a basic course with visions of earning quick bucks. I was confident that the non-so-insubstantial sum paid for the course will be quickly earned back, and more. The reality? Not quite.
What I quickly realised is that you are not "playing" the market, you're actually playing with yourself. The theory of forex trading is easy enough, but applying them takes discipline and an iron constitution such that you are not swayed by "noise". Many new traders/investors get emotional about their positions, hanging on to a bad investment past the time when they should have cut loss. They make impulsive trades trying to chase the market and set take-profit and cut-loss targets but don't stick to the targets. Yes, I made all these mistakes. It's easy enough to say "I won't do that", but when it's your money at risk, people tend to act differently.
Not to say that forex trading doesn't work. It is nowhere near as risky as people make it out to be. When people say that forex is risky, what they actually mean is that it is volatile. And it is precisely this volatility that makes it exciting and gives traders the opportunity to make money. As long as you set your stop-loss and close out your trade when the market closes, you won't lose more than you can afford to.
In the end, whether you make or lose money in the forex market boils down to time and discipline. As a newbie, you'll probably need to spend about 2 hours every day, Monday to Friday, charting the market to determine whether there's an opportunity or not. And as I've mentioned earlier, you need to stick to the rules. (Experienced traders may disagree with me, but the maxim holds true: In order to break the rules you need to first master the rules.)
As for me? I decided I don't have the energy to give it the time it needs, so my account is currently lying dormant - for now.
- Esther Perh
This page is purely for informational purposes only and should not be relied upon as financial advice. The statements and opinions expressed on this page are my own and are not endorsed by finexis.
