Although I aim to become successful in the stock market before I dabble in Forex, it still interests me quite a bit. A friend recently emailed me a snippet of an article on Forex:
Quote:
There is no secret to trading forex, well I say no secret, whatever you don't know is a secret. All you really need to succeed in forex is some hard work and everything contained in each part of this article.
Lets start by creating a business plan. Forex is like any other business It requires a lot of planning and preparation. You must know your daily/weekly/monthly and yearly goals.
Your business plan can be altered to fit your situation however I know many people using the one I am about to explain.
My goal in forex is to make a comfortable living (not a fortune) I do this by setting small goal that are easily reached daily with minimal risk in the market.
My daily goal is 5 pips, now I know for a fact that there will be many people reading this who have been focusing on 100's of pips a week but you simply do not need to be in the market for so long in order to make a lot of money.
This business plan starts with an account of $5000. The risk per trade is never more than 5% and the stop is always 20 pips. I would like to quickly point out that the stop is for emergencies only it should never get hit as I manually close trades before they ever get into double digit pips.
What you need to understand is compounding is very powerful and you best friend when it comes to making money in the forex market.
Using my small target of 5 pips a day risking 5% on a 20 pip stop a $5000 account would grow into almost $100,000 in 12 months!
This is the easiest way to make money in the forex market, minimal exposure and the pips are normally bagged before breakfast.
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Seems pretty good, eh? The only fault I can find with this is that when he speaks about exposing himself to only 5% losses, he almost sounds as if he is confident enough in his Forex purchases to hardly ever take those losses.
- alex
