Ten Steps to Becoming a Successful Forex Trader (For Beginners) – Part 2
(Continued…)
- Now that you have some confidence in your trading abilities, it is time to try what you have learned on a live account. But do not get too overconfident at this stage, no matter how successful your demo account test was – because trading with real money is much different (psychologically and emotionally) than trading with virtual funds. The very presence of the variable of real money can actually change the way that you trade – and as such it is possible for your trading edge to disappear.
- Once your live account is open, fund it with real money. But be warned – do not fund it with money that you cannot afford to lose! Think of this money as your tuition fees for learning how to trade in the best forex university in the world. So don’t put next months rent money in there – because it is likely that you will lose some or all of it. This is not going to be as easy as trading on the demo account, and the less you care about the money – the better.
- Try to emulate what you did on your demo account as much as possible – but keep learning and if you feel you need to, keep studying. Software such as Forex Tester (www.forextester.com) can help you to practice in a very realistic setting while the markets are closed, or slow moving, and this kind of practice can be invaluable.
- If your methodology is successful and you are profitable for three consecutive months, think about increasing your risk levels in line with your new bank (i.e. if you started by risking $30 per trade on a bank of $3000, and your bank has risen to $3500, then you can now risk $35 per trade. However, do not reduce this amount if you make a few losing trades.
- So you have traded for a full year and your bank of $3000 has risen to $4500. It has been a very successful first year with a 50% rise on the bank. Do you withdraw your $1500 and enjoy it, or do you keep the money in your trading bank and trade with it? Only you can decide that I’m afraid – but if you do get to a point where you have to make such decisions, then I applaud you. However, be warned that it might not be so easy, and it might take a lot of determination and 2-3 years of learning before you can even get close to that point.
