This is a question that we deal with a lot, because you will get a lot of different answers online. When it comes to breaking into the world of forex or binary options, money is something that you’re going to have to have. Answering this question is something that you have to discover for yourself. In other words, all we can really say is “it depends”.
What does it depend upon? Well, that’s actually what THIS guide is all about.
You see, it depends on your risk tolerance and how the rest of your life is actually structured. If you live in a world where most of your needs are already taken care of and you have a good emergency fund in the bank, investing in forex with money that you’ve set aside isn’t a bad thing. You’ll be able to weather some losses as you learn how to be a better trader. If you are new to binary options trading make sure to try out binary options demo account to get a hang of it.
Yet if you’re struggling to make ends meet and you’re getting sucked in by forex advertisements online and how to make big money in forex, you might be in for a wild, wild, ride. It’s better to stop while you’re ahead and wait until things are most stable in your home life. We say this for a good reason — forex is a big deal. It’s a fast paced market where currency pairs can move about wildly. You can indeed make big money, but you can also lose big money as well. It’s going to be up to you to make the most out of your trading. Everyone is going to develop their own signature style and it’s important to really make sure that you have yours. Failure to do this will only end up in losses that you might not be able to handle.
We think that going with at least $10,000 in capital is a good thing. It sets you up for a nice forex account where you can make some big plays and get interested in different currency pairs at the same time. Far too often when you only have $100 – $500 to spend in forex, you end up making bad plays because you really didn’t have enough leverage to do anything big.
Speaking of leverages and margins, that’s going to play into your trading capital as well. You don’t want to play forex on margin until you have all of the basics down pat and you’ve been using real money for a while. It’s tempting to just dive in, but again, there are consequences to every action, and not every consequence is a good one. You just need to make sure that you are looking into all of your options and being careful. Forex is going to be around for a long time, so there’s no real need to think that you have to rush right in. The market will have gold in it for you in good time as long as you respect the market by being knowledgeable beforehand. See how that works? 🙂
Again, we can’t stress enough the power of getting all of your mistakes out by looking at a demo account first. It might sound cheesy and lame, but papertrading is something that works each and every time. Would you really start out with a Corvette as a new driver? No, you would want to train on a beat up car that’s been in the family for years. You drive at night in an empty parking lot where nobody can hurt you in the slightest. That’s going to be the best way to really make sure that you have things taken care of with your car, and using a demo account first is going to make sure that you become a good investor.
Mistakes in forex happen, and we’re not saying that a demo account is going to remove all of them. However, when you know that you don’t completely know what you’re doing, a demo account lets you test out strategies to see how they work in action.
It’s time to go past theory. It’s time to go past just guessing, and it’s certainly time to go past hearing stories on forums. You have to figure out what’s going to work for you in the long run.
Take all of this in mind when you figure out what you need to get involved with forex. You’ll be a better person for it, we promise!