Currency trading guide
Currency trading is all about making money on the fluctuations in exchange rates. The purpose of the foreign exchange market is to achieve the highest possible return on the risk you are willing to take.
Anyone can start with foreign exchange trading, if you have money. The good news is that you do not have to be rich to start with this. If you can afford to play the lottery or buy coffee at the café, then you probably also afford to trade the currency.
An important rule is that you should never trade more than you can afford to lose. It does not necessarily mean that it is extremely high risk that you will lose money, but rather that investment always involves risk.
If you do not tolerate risk, the bank is the only option. But low risk costs too much, you lose the opportunity to get a fantastic return, and must instead settle for an interest rate as low inflation cost makes you actually lose money in the bank!
Do you have the financial background to start with Forex?
Whoever claims that trading is only for the educated, have hardly even been involved in trading. There are all kinds of traders and we have seen how beginners have made millions on speculation, and that several years later still doing well and earn good money.
The best way to learn trading is to practice. See below what you need to get started.
Social trading - what do I need?
In order to start doing social trading, you will need:
- Internet access (via PC / Mac / mobile phone / tablet)
- An online broker - we recommend eToro
- Time (You will not get rich overnight, be patient and learn from your mistakes!)
100.000 million or more are not necessary, but...
To make money in currency trading, you must of course start with a minimum of money. To begin to earn substantial money on foreign exchange trading, and to live by this, you should probably go into the hundreds of thousands (when you've had enough knowledge of foreign exchange).
500 million is enough in the first place
You need not be a millionaire to engage in the trading of currencies. Do you have 500 disposable is more than enough to try some. Although the amount of this you can start with if you use eToro.
Leverage - the potential gold mine
One advantage of currency trading is the ability to "leverage". It will say in short that you can leverage your investment, but it's not like a normal loan.
Instead, you risk only to lose the money that you put in to guarantee the loan.
For example, you can change gear 1:100 and put the 500 itself, and thus get 50,000 dollars to trade for. If the investment is only 1% in your favor, it means you will get 100% return, thus doubling your investment.
Let's say you take a larger amount, and deposit 10,000 dollars. You are now able to borrow as much as NOK 1,000,000 (one million), and your personal risk is limited to only 10,000. Going investment when up such modest 5% you have earned 50,000 million, ie five times
There are many online brokers to choose from, here are some links to online brokers which offers everything from currency trading, stock trading, commodity trading and more.
The online broker we recommend right now is eToro.