A couple of starting questions

[Fat_Tom]

Hi folks,

I'm looking at trading the forex as a plan B.

Currently an IT consultant but would like to move over to Forex trading in 10-15 years time...

So I have been demoing a MT4 account and all is well (well its not but thats not the purpose of this post!)

Basically at some time in the next 12 months I would like to trade with real money. At this stage I am looking to start a small pot (less than £1000). I am perfectly happy (and expect) to loose it all and have to start again.. and again etc.

Thing is I have been reading quite a few posts regarding capital require to start sucessfull trading - quite large numbers are often banded around (well over 10K) This I can't afford to loose!! This doesn't appear to make sense to me as surely if you have a lower pot you can just trade with smaller lot sizes/leverage? if you can find an appropiate broker?

Am I right on this or wrong? if so what are folks starting their trading from? I will be very much part time trading for fun for the first few years hopefully slowly ramping it up over the years to a second career.

Whats folks opinion on the above?

Also if im right can anyone recommend a broker (prefferably MT4 platform although can be flexible on this) that can enable me to trade in this way?

Thanks for reading!!!

cheers

Fat Tom

 

[Rhody Trader]

First of all, it's not "the forex". I have no idea where that came from on the retail side, but you can be sure it's not used among market professionals.

Secondly, you can start trading forex with a very small stake. Oanda, for example, has no minimum account or trade size. Starting small is a very good idea.

 

[shadowninja]

Probably those scam guides you can buy on the interweb.

 

[Trader Rich]

Start out with a shoe string to learn the rope is definitely fine for new traders. Make sure to adjust your position size accordingly. I have posted a set of day trading rules, you might want to take a look at.

 

[disi]

Hi folks,

I'm looking at trading the forex as a plan B.

Currently an IT consultant but would like to move over to Forex trading in 10-15 years time...

So I have been demoing a MT4 account and all is well (well its not but thats not the purpose of this post!)

Basically at some time in the next 12 months I would like to trade with real money. At this stage I am looking to start a small pot (less than £1000). I am perfectly happy (and expect) to loose it all and have to start again.. and again etc.

Thing is I have been reading quite a few posts regarding capital require to start sucessfull trading - quite large numbers are often banded around (well over 10K) This I can't afford to loose!! This doesn't appear to make sense to me as surely if you have a lower pot you can just trade with smaller lot sizes/leverage? if you can find an appropiate broker?

Am I right on this or wrong? if so what are folks starting their trading from? I will be very much part time trading for fun for the first few years hopefully slowly ramping it up over the years to a second career.

Whats folks opinion on the above?

Also if im right can anyone recommend a broker (prefferably MT4 platform although can be flexible on this) that can enable me to trade in this way?

Thanks for reading!!!

cheers

Fat Tom

Hi Tom,

Firstly - you do have any source of income? My advice is - start trading DEMO for 6 months. What newbie do wrong is that they CAN NOT earn money on DEMO account, but for some strange reason they believe that when they enter LIVE account they will start earning. Wrong! Don't do it. Trading is a skill-same as other skills. You do not drive F1 car if you never driven even a regular road car.

Trade DEMO. Find what works for you. When you feel OK start trading small position on LIVE accounts - just to train your psychology so you can see it can deal with 'real' money(opposed to DEMO money). Then you can start adding money to LIVE account. Eventually - if you are serious about trading you will have to have bigger account. You have to control risk - you can not do it with 1,000 account. IMO 2,000 is a minimum size of account if you want to start trading mini lots(0,1).

I hope it helps.

 

[NetTecture]

Hm.

That makes no sense, sorry.

Currently an IT consultant

and

quite large numbers are often banded around (well over 10K) This I can't afford to loose!!

Just do not match up. Until end of last month I was around as IT consultant myself (now trying out trading - with my small company still providing for me). Anyhow, 10.000 is what I took in nearly in a month, after taxes and cost. Ok, deduct some more for appartement and overhead, but that still puts this "large number" in around 3 months income.

This is not hugh. By no margin. Unless "IT-Consultant" is now identical to "unemployed HTML coder" or something. Even an employed programmer would not see that as more than a year's savings. Not life breaking.

Add to that:

Currently an IT consultant but would like to move over to Forex trading in 10-15 years time...

And the logic is out of the window. Heck, 8 years ago I went out of trading for an IT career thanks to psychological issues I had then (with a very bad relationship). A 10 to 15 year timeframe for a career change sounds a little suspicous to me.

That said:

* I would forget about trading, unless you can produce results of 1% per day with smaller amounts of capital (below 100.000 EUR around - the larger you get, the harder this is, due to market factors). This would put you into the EUR 200 per day range for a EUR 10.000 account. Most people can not do it, but if you want a career in trading, this sounds like a nice goal.
* I would put in an action plan. Now. 10 to 15 years to live from it? Are you aware of the Infinite Yield Forex blog? Some guy takes there a small account to 150.000 USD one with simple trades - rules FULLY disclosed (i.e. you can just follow them). He is now up 452% since December 2007. The account went from USSD 500 or so to USD 2762,5 for April. He plans to be finished in significantly less than 10 years.

Basically, put in USD 1000, follow that. The rules are fully disclosed and there are two trades, one from friday to monday, one monday to exit. So, basically, you can do so on the side. Fore free.

I actually think of soon using my margin on the weekend for those weekend trades. Return is not that great compared to other things, but then weekend is normally mostly an "out of the market" situation for me, so it is additional money.

Whatever you do, get real on a demo account. If you can make money there nothing is prooven about real trading, but if you can NOT make money there, then better.... learn. My last demo run, deciding to get real AND get together with some books, mentoring etc. (starting today at a side - i just opened a trading journal about that) makde 150% profit in one week on a demo. Way too much risk for real trading, but at the end I know I CAN make profit on a demo (still).

So, advices are:
* Adjust timeframe. 10 years is too much.
* Adjust reality. Either you are IT consultant, then 10.000 USD or even EUR are not exactly that much for you. Or you are unemployed programmer etc., then - even then - EUR 10.000 are not THAT much.
* Get going Note that you have a low chane to succeed, but if you think like it, you have to try. And if you are lucky and a hard worker, then - well Welcome to a different life. At least payment will be a lot better than what you get as IT consultant.

 

[Fat_Tom]

Hm.

That makes no sense, sorry.



and



Just do not match up. Until end of last month I was around as IT consultant myself (now trying out trading - with my small company still providing for me). Anyhow, 10.000 is what I took in nearly in a month, after taxes and cost. Ok, deduct some more for appartement and overhead, but that still puts this "large number" in around 3 months income.

This is not hugh. By no margin. Unless "IT-Consultant" is now identical to "unemployed HTML coder" or something. Even an employed programmer would not see that as more than a year's savings. Not life breaking.

Add to that:



And the logic is out of the window. Heck, 8 years ago I went out of trading for an IT career thanks to psychological issues I had then (with a very bad relationship). A 10 to 15 year timeframe for a career change sounds a little suspicous to me.

That said:

* I would forget about trading, unless you can produce results of 1% per day with smaller amounts of capital (below 100.000 EUR around - the larger you get, the harder this is, due to market factors). This would put you into the EUR 200 per day range for a EUR 10.000 account. Most people can not do it, but if you want a career in trading, this sounds like a nice goal.
* I would put in an action plan. Now. 10 to 15 years to live from it? Are you aware of the Infinite Yield Forex blog? Some guy takes there a small account to 150.000 USD one with simple trades - rules FULLY disclosed (i.e. you can just follow them). He is now up 452% since December 2007. The account went from USSD 500 or so to USD 2762,5 for April. He plans to be finished in significantly less than 10 years.

Basically, put in USD 1000, follow that. The rules are fully disclosed and there are two trades, one from friday to monday, one monday to exit. So, basically, you can do so on the side. Fore free.

I actually think of soon using my margin on the weekend for those weekend trades. Return is not that great compared to other things, but then weekend is normally mostly an "out of the market" situation for me, so it is additional money.

Whatever you do, get real on a demo account. If you can make money there nothing is prooven about real trading, but if you can NOT make money there, then better.... learn. My last demo run, deciding to get real AND get together with some books, mentoring etc. (starting today at a side - i just opened a trading journal about that) makde 150% profit in one week on a demo. Way too much risk for real trading, but at the end I know I CAN make profit on a demo (still).

So, advices are:
* Adjust timeframe. 10 years is too much.
* Adjust reality. Either you are IT consultant, then 10.000 USD or even EUR are not exactly that much for you. Or you are unemployed programmer etc., then - even then - EUR 10.000 are not THAT much.
* Get going Note that you have a low chane to succeed, but if you think like it, you have to try. And if you are lucky and a hard worker, then - well Welcome to a different life. At least payment will be a lot better than what you get as IT consultant.

Well NetTecture you do make a lot of assumptions.

I am an IT consultant and am a relatively high earner however you have no knowledge of my finacial situation and believe you me I cannot afford to loose 10K and if I opened a 10K Forex account with my level of experience then I can assure you loose it I would!!

Also If I have 10K burning a hole in my back pocket I think I would be tempted to hang onto it in this current economic enviroment as opposed to 'gamble' (a reflection on my current trading skills :whistling) on the Fx markets.

With regards to the 10-15 year timeframe this is mainly as I think my industry (messaging directory services etc) will effectively be non-existant due to cloud computing etc within 20 years. IT services will become a commodity item as sure as you turn on the tap and the water comes out so I fear it will be as such with IT services.

I have recently opened an £200 account and have begun trading from that. This is as far as I am concered a demo account. I am trading with 0.01 lot sizes so wins and losses are often around the £5 mark. This account I fully expect to loose (I can afford to loose £200!!) and quite possiblly the next £200 and the next £200. I found previously hard to demo and take serious trades all the time so this is for me better.... yes it is real money but small amounts.. funny how different feeling it is compared to demo trading even when the figures are only the price of a packet of fags!

Once this trading becomes profitable I will up the account to £1000 then £10000 and then? well one step at a time...

Obviously if this all comes together before 10-20 years then good... I will go with it... but I like to take my time to learn and I feel no pressure at the moment to earn from Forex I will take my time and learn to trade!!!

Thanks to everyone for their advice!!!

Fat Tom

 

[jiggly]

I have recently opened an £200 account and have begun trading from that. This is as far as I am concered a demo account. I am trading with 0.01 lot sizes so wins and losses are often around the £5 mark. This account I fully expect to loose (I can afford to loose £200!!) and quite possiblly the next £200 and the next £200. I found previously hard to demo and take serious trades all the time so this is for me better.... yes it is real money but small amounts.. funny how different feeling it is compared to demo trading even when the figures are only the price of a packet of fags!

Once this trading becomes profitable I will up the account to £1000 then £10000 and then? well one step at a time...

Obviously if this all comes together before 10-20 years then good... I will go with it... but I like to take my time to learn and I feel no pressure at the moment to earn from Forex I will take my time and learn to trade!!!

Thanks to everyone for their advice!!!

Fat Tom

excellent, you have the correct mindset, best wishes to you,

however dont fall into the trap, of losing and replenishing that account frequently, otherwise you might find that the £200 you could afford to lose has turned into thousands, by all means, you should work towards preserving this capital and model it as if you had a much larger one. £200 every six months for the sake of learning is not going to kill you.

I have one suggestion, before adding further funds, begin by doubling your account, then double it again, or match what you have made as you hit milestones you set.

build your experience and formulate your trading strategy and plan....

good luck