In any business, you could not know for sure how much you can profit or whether you could make profit at all. The same is true in forex trading. If anyone said that they can assure you of it, then you need to be suspicious of them. The journey to profit is like a steep and rugged terrain, so how do one could stay and make profit in forex market?

How much profit could one make from trading? CNBC a few days ago (9/6) reported that hedge fund firm Baupost Group apparently have made almost 1 billion USD from just one stock in its portfolio. One of the largest hedge fund in the world, the company have accumulated stakes in Idenix Pharmaceuticals which was bought by Merck, boosted the stock's value almost overnight. It is assumed that Baupost has quadrupled its position, having paid 320 million USD for shares that now worth 1.28 billion USD.

Forex
Considering the high risk nature of financial market, there has been numerous question on whether it really is profitable or if getting rich trough trading is actually a myth keep alive by certain people to dupe us. Stock market has been known to turn ordinary people into millionaire when they are smart enough to choose brilliant, diamond in the rough shares. However, the market is not always in the up and up. Investors who have experienced financial crisis could tell you how much they lose when share values dropped like flies.

The same risk is more than doubled when we talk about forex market. The 'derivative nature' of forex market keeps the odds against common forex traders until some people even commented that it is impossible to win in this business. Nevertheless, there are people who have made it in forex trading, be it as a sidejob or build it into a fulltime occupation. Most of them don't boast of their conquest in public, but instead, stay quiet and we'll only know them through their anonymous commentaries and rare analysis. Some of them shifts role into forex trading guru, a position that certainly contains less risk.

In any business, you could not know for sure how much you can profit or whether you could make profit at all. The same is true here. If anyone said that they can assure you of it, then you need to be suspicious of them. The journey to profit is like a steep and rugged terrain, so how do one could stay and make profit through forex trading?

 

Set Objectives - Why Do You Trade?

Plan a set of objectives on what you would like to gain from forex trading. The plan at the least should contain answers for the following questions:

  • What do you want to attain, how much, and for when?
    Planning for a holiday fund will be different with planning for a retirement plan. As well, planning for a few hundred profit additional pocket money is different with planning for your daily expenses.

  • What are your long-term plan?
    Your first goals could be as short as you could make it. However, a good trader always thinks ahead. The high degree of uncertainty in this market makes it a good thing to place a few contingencies. Like people says, don't put all eggs in one basket, you should not rely 100% on the fruit of your trading. In this regard, you should look to own some low-risk financial asset, such as house, retirement funds, properties, etc. This way, you won't blow all of your inconsistent profit in one go. Remember that everyone will get old and that we should set a good retirement plan as early as possible.

By setting the two objectives (in writing if possible), you have pledged yourself for a battle for financial prosperity that you can't easily back down.

Learn The Market - Explore Trends And Strategies

Not every trader has studied economic deeply previously and could easily understand financial language. It could be even said that most people in forex trading don't own an economic diploma. Everyone start from the same beginning, studying the same chart, and struggle to conquer the same market. Renowned master of energy trading, Cynthia Kase, has Chemical Engineering background. Bill Lipschutz, one of few known forex market wizards, was a bachelor in Architectural Design, although he did later gain an MBA from Cornell University.

So how do they are able to became so successful? They learn the market.

Cynthia Kase taught herself technical analysis and trading system programming and went to be a master of the subject. Bill Lipschutz received an inheritance and then began to learn investing properly afterward. And two of the most famous examples of extensive learning are technical analyst George Lane and Walter Bressert. They studied the market deeply, delved into other people's methods, and managed to build their own tools and analysis.

Studying the market can be time-consuming; it could not be done in a short time nor just at a glance. One should study as much as he can and then went to master a certain skill in which he could establish his own method.

 

Gather Experience - Practice Forex Trading

There is nothing wrong by adopting other people's strategies, but be aware that their strategies might not suit your profile. Their strategies could have relied on limitless funds which you don't own, or integrated instinct in which every person must be different, etc. So get on  with your practices and build your own strategy.

In the forex market, experiences could literally make you rich. No trader could suddenly gain countless profits without ever lose even once. In the course of building your own strategies, you will suffer losses and maybe devastated by margin calls. However, those are necessary sacrifices in order to advance further.

One thing you should remember is that there is no such thing as a holy grail or undefeated strategy. Perfection is not ours to own. So, what to do? stick with flawed trading strategy? Of course not. Learn what differ a chapped trading strategy that will wipe your funds with a profitable forex trading system that could produce consistent profit albeit with some losses in between. To do that, you will need time and plenty of energy, so stay motivated, and trade!