Why do investors and traders become interested in the Forex Market? It is money of course. They would not be in it for anything other, well maybe bragging rights, but that comes with successful trades. It is surprising that only a small number of people bother to learn and develop a system that works Many do not even gather general information on forex market. You can make money trading forex. That’s a fact. But you need to figure out what type of trader you are going to be.
Forex trading has become the one of the most profitable investments in the world. Mainly because many people do not need to be trained and educated for long periods before they start earning money. As opposed to other industries forex requires only some time to learn the basics about foreign currency trading. With today’s computer systems, charting and graphs, historical data and calculations at your fingertips, it is pretty easy. There are many online training systems and now must brokers offer signal and alert service so you know what to trade and when to trade it. I call this the lazy man’s way of trading forex.. just trade the signals you get via SMS and you will have the same success ratio as the service provider. Its easy.
Most investors learn forex trading but not everybody manage to achieve success.
If you want to become a successful trader, first of all you should acquire a sound plan.
Most traders fail to succeed in the foreign exchange market, because they lack discipline and let emotion take over instead of relying on money management and risk management. The best type of trader is the calm and cool trader, he takes his time, he plans and calculates but he makes trades and is successful. He may not trade as often, but his success ratio is excellent.
There is no perfect strategy or system of trading, as forex trading is not perfect itself. There are some effective tools to be used, but still they cannot guarantee you a 100% of success hell, they can not even gaurantee you a 75% success ratio, as the market is volatile and unpredictable. When developing a system or strategy, if you have a success ratio over 50% you will be a winner.
If you are patient enough to make effective trades then you can invest in some reliable trades and make great profits. There are the slow and cautious traders, they plan and chart and read and review, unfortunately they usually miss the entry points or miss the trades entirely. They are successful, but spend a great deal of time and miss out on many opportunities that they had correctly predicted. These are the over thinkers.
Money is not the issue here. Some people just desire to be the part of foreign currency market and leave everything for fate to decide. Anyway, they are still contributing to the industry, their money at least. These are the luck players. They never risk much, sometimes they win and sometimes they lose.
Lastly we have the kind of traders that are called jumpy traders. These are opposite ones the cool, calm disciplined trader mentioned above. They are impatient. They are always checking what had happened in the forex markets, especially the trade they have made, they want fast action and fast returns they are hot to play, like gamblers. But they never just trust their trade, never fully trust their system and they are always changing their rules and strategies. These are the least successful.
Though they do not like to spend learning, reading, charting they just want to make the trade. They are itchy to trade. They are like the guy on the golf course that just wants to swing and never enjoys the game. Sometimes they land on the green and sometimes in the traps. In the long run they are not successful traders.
We have four types of traders:
- Calm and Cool
- Slow and Cautious
- Fate and Luck
- Jumpy and Sporty
Where do you see yourself?
Calm and Cool or Slow and Cautious