You will be pleasantly surprised to know that a novice trader can make money on the stock, foreign exchange, and commodity markets. But how much money can you get? Keep reading the post to know the strategies that will help you make money.
Forex Trading as Your Main Source of Income
Nowadays, you do not need to invest significant funds to work on the exchange; it is enough to have a computer, Internet connection, and a minimum amount of money. That’s it. Nevertheless, according to recent statistics, about 80% of novice traders encounter failure. So is it realistic for a beginner to make money with Forex trading?
A beginner can make money on the stock exchange. To start earning on the stock exchange, you need to master the skill of trading, understand the rules of the market, and be able to carry out technical and fundamental analysis. Great success in the investment business is achieved by those who approach this business seriously and keep an eye on market conditions.
To make money on the exchange, you should develop the following qualities in yourself:
- ability to analyse;
- finance management.
The above talents cannot be learned from books, so not everyone who knows a lot can make money in the Forex market.
How to Make Money with Forex?
There are two ways to make money on exchanges in South Africa: through trading and investing. As such, there is no major difference between trading and investment; it is too blurred. Most experts agree that trading is a short-term business, while investments imply a long-term approach. Another group of experts believes that investments are aimed more at passive income (dividends), and not at the resale of the asset. Let’s dive deeper into the different business schemes.
#1 — Trading
The trader's task is to get an income in a few minutes, hours, or a couple of days, and then exit the deal. When investing money for a short time, you need to have a trading strategy. The volatility of an asset is of critical importance for a trader because he earns on fluctuations. The stronger the fluctuations are, the more earnings on the stock exchange you can count on.
#2 — Investments
Unlike traders, investors are more focused on long-term return on investment. The longer the asset makes a profit, the better. As a rule, the term of holding a position takes from 1 to 10 years, but this is not the limit.
How Much Can a Beginner Earn with Forex?
What level of income can a novice trader expect on Forextime? In the perfect world, a novice investor can earn about 20-50% in the stock market in the first year of his work. Traders can earn a higher percentage of profits, but they also spend more time at work. The fact is that 1-3% per trading day can be considered an excellent result.
However, several conditions must be met for this to happen:
- Continuous training;
- Trading predisposition;
- The presence of strict discipline in compliance with risk management and analytics.
Instead of making the first deals right away, we recommend that you dive deeper into the theory, get quality Forex education, master your skills, and learn how the market works.
Forex Trading Tips for a Beginner
To help you play a safe game, we have prepared some useful tips that many experienced investors should stick to:
- Don't expect quick profits from the stock market. You will hardly be able to make more immediately;
- Start investing with small amounts. Make a few trades and see how it works. This will help you avoid sensitive losses at the initial stage;
- Don't confuse investment and speculation. Anyone can become an investor, but active speculation requires certain skills. It is not suitable for everyone;
- Watch for commissions and don't forget about taxes. It is necessary to cut costs as much as possible and make profits flow;
- Diversify your investments, that is, invest not in one but a set of assets. This will reduce the risks;
- Don't be discouraged by mistakes. All novice investors do them, and there is nothing to worry about.
Is it realistic for a beginner to make money on the stock exchange while sitting at home? Of course, it is a reality. With the development of modern communication technologies, the question of whether it is possible to make money on the exchange should not cause any doubts in you. Experienced traders have learned how to get a stable income from securities trading. However, you need to understand that trading is just as much mental work as others.