10 Things You Should Know Before Starting Your Forex Trading Career

Winsor Hoang |

Prospective Forex trader do not always have all the right information before making the decision to commit to this interesting but also challenging industry. But because Forex is not for everyone, knowing what you are getting yourself into may cause you to reconsider or you may feel more confident about your decision. If you're thinking about becoming a Forex trader, there are a few things that you should be aware of.

1. You know you will not be a millionaire in a year.

You won't even be a millionaire in three years. In fact, if you're starting Forex with the hope of becoming rich quick, you may want to reconsider the decision entirely. Creating instant wealth is a highly unrealistic goal. For one, there are too many factors a trader cannot control which play a key role in how much they make. Secondly, traders who enter Forex under the pretense of earning easy money are more prone to making mistakes and falling for Forex traps--all of which ensure that you lose more than you gain. If you are serious about creating a Forex trading career, you need to leave unrealistic expectations at the door and understand that Forex is like anything; it requires hard work, patience, and lots of discipline. Anyone who tells you otherwise is probably trying to sell you something.

2. You realize it's about the journey not the destination.

This applies to what was said above. If you want to create a profitable career in Forex, you need to focus more on the journey rather than the "prize" at the end. Doing so will help you test your systems more thoroughly so you know if they are built to endure through the long haul. It lets you stay emotionally balanced, even when you are going through a period of losses, and it lets you curb your enthusiasm when you're going through a string of wins. Forex is about more than just making money; there are a number of personal development lessons you'll come to realize and looking at Forex as a journey gives you a better chance of using the lessons to create profits.

3. You keep learning.

Forex is not something you learn once and become a master of. The financial world changes constantly and with it does the rules of Forex trading. If you aren't willing to stay up to date, keep learning, and continuously test your knowledge you will struggle to make consistent profits. Keep an open mind as a trader.

4. You don't make trading harder than it has to be.

There are a number of tools available to traders that make the journey easier. Look for these tools and utilize them. Trading itself doesn't have to be difficult, but if you are manually trading or using outdated methods, you're making trading harder than it should be. Consider applying relevant tools and services to your trading strategy in order to make consistent profits easier.

5. You need money to make money.

What most trading experts won't tell you is how much you are going to lose as a trader. Forex is just as much about the losing trades as it is about winning ones. If you aren't financially prepared to take the hits, Forex trading will be a real struggle for you. Not only will it affect you financially as you watch the market take your money, but emotionally as well. Many traders fall into depression and anxiety as a result of a losing streak. Those that are able to make consistent profits in Forex are also able to handle consistent loss.

6. You like to challenge and test your knowledge.

Forex trading involves consistent upkeep of knowledge. Once you learn something, you have to test it, and then retest it. It's a lot like being a scientist where new findings can affect your potential for profits. If you're someone who likes to learn, and likes to test out theories and strategies, you have a desirable trading trait.

7. You work well alone.

Most people aren't as self-motivated as they think, or as self-disciplined. However, true traders are. They are like lone wolves that can spend hours on end alone as they learn and develop their skills. It is important to have this quality as a trader because you have no one to answer to, except the market (and the market only speaks in terms of gains and losses). No one is going to tell you how to run your Forex career. No one will hold you accountable to your Forex plan and strategy. It's up to you to put in your all into becoming a proficient trader; and it is up to hold yourself accountable. If you're someone who requires hand holding, constant reassurance, or simply a boss to guide you, Forex may not be for you.

8. You aren't afraid of failure.

It's important to note that you are not a failure simply because you lose money in Forex, but the fact is you can't come into Forex with a fear of losing or be someone that equates losing to failing. All traders, even profitable ones, go through a losing period. A trader has to focus on what they can learn from it and continue to develop their skills. A fear of failure will simply hold you back from consistent profits.

9. You are emotionally stable.

Those who already suffer from anxiety may need to carefully consider whether or not trading is for them. Trading Forex is an emotionally trying task. Those who are able to create consistent profits have taken it upon themselves to emotionally manage. Even highly calm/stoic people should still emotionally manage. This may involve mediation, yoga, visualization exercises, et cetera to improve the ways you handle both the wins and losses of trading.

10. You like to stand apart.

Creating consistent profits is heavily dependent on your edge. In order to even consider what your edge could be, you have to be someone who thinks outside the box, doesn't follow the crowd and looks to your own talents and personality as assets. The reason I included the latter is because most traders will find their edge within themselves. For example, you may be a highly focused individual, which could work to your advantage. Regardless, you need to be someone who doesn't follow the crowd and likes to stand apart if you're serious about creating an edge.

A Forex trading may be suitable for you; however, before you start searching for trading systems consider the information above.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

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