Each trader will have their own story. However, everyone will face similar problems. Your reaction to those problems and the methods you’ll use to deal with them - that’s what will be different.
Most beginners get lost when it comes to real money trading. There is a huge frightening world of the foreign exchange market right in front of you and you want to know how not to lose your entire investment from the start. I will give you four practical tips that you should remember when you take your first steps. Without further ado, here are these tips.
Always Start With Cent Account
If you haven’t come across this concept before, then cent is the account type where all transactions are carried out in cents. That is, if you put $10 in the account, then you will see $1,000 on your balance. Then simply trade as in a regular account. Just imagine that you really have $1,000.
Of course, you won’t earn much profit because each pip will cost not $10 when trading in 1 lot, but only $0.1. However, trading on a cent account has undeniable advantages:
- You will practice trading real money in real conditions while not risking large amounts.
- You will learn how to trade following your trading plan. Since you will risk small amounts, the chance of involving emotions will be minimal and that will exclude most of the beginners' mistakes.
Try New Things
I understand that this is rather obvious advice but its understanding and implementation are crucial. We all would like to get the magic grail, a special win-win trading strategy that will allow us to conquer the market the first minute. However, the experience of millions of traders has shown that such a thing simply doesn’t exist.
The only thing left for us is to find the best way to trade by trial and error. Since you are an individual person, with your own traits and characteristics, the trading method suitable for you will be unique. You just have to try all possible options and stop at the optimal one for you:
- Try different trading styles.
- Try trading with and without indicators. Choose the most convenient for you.
- Test different trading strategies.
- Try to trade at different times during the day, etc.
Of course, in theory, it would be great to learn from the mistakes of other people. However, in reality, you will have to make your own. What matters is your ability to recognize them in time and draw conclusions. Keeping a trading journal will help you out with this.
Don’t Waste Money
This is not about investments but about the acquisition of paid strategies, Expert Advisors, indicators, and payment for the services of a Forex mentor. I’m not saying that mentors are completely useless but at the initial stages when you just take your first steps in trading, it makes no sense to spend money on it.
You may need a mentor if you want to study in detail a specific complex trading technique. However, you will need this no earlier than after a couple of years of trading. You won’t become a confident trader with a consistent profit earlier than in two or three years, with or without a mentor. So, I see no reason to spend money on this, since the result will be the same.
Stop Searching For an Idol
I am talking about a Forex idol. It makes no sense to choose an individual successful trader whose methods and tips you will copy 100%. No matter how professional he is, his strategies might not work for you. You are two different people. What works for him will not necessarily work for you. It is worth listening only to general concepts. And the rest is to test before taking on faith.
Try to take risks as little as possible and embark on dubious adventures with strange Forex gurus that promise you a star from the sky in a couple of months. The best course of action for you would be methodical testing of trading methods and risk control using a cent account. I can only wish you good luck and perseverance in achieving your goal.