Posted by forex at 2:13 AM
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1. Learn as much as you can about the foreign exchange market. Read specialized books, preferably written by start Forex traders and investors. For up-to-date commentary and analysis, access business news agencies like Bloomberg or Thomson-Reuters.
2. Construct your own trading strategy. A trading strategy is a set of rules or guidelines that a trader follows in his trading decisions. Base your trading strategy on the FX instruments that you are most familiar with. Remember that potential gains are usually commensurate with the risks--if your strategy is super profitable, chances are that it is too risky and you may lose all or a large part of your investment.
3. Find a broker with a good reputation and competitive fees. You can get a list of brokers through a simple Internet search. Ideally, your broker should have a wide range of FX instruments available for trade, low commissions and a lot of clients. You can check a broker's legitimacy with its regulator (Commodity Futures Trading Commission in the United States).
4. Open a demo account with your broker and test your strategy. A demo account is just like the real account, but the money is not real. All good brokers allow anybody to open a demo account to get familiar with their trading platform and get practical trading skills.
5. Determine how much money you wish to put in your trading account and deposit the funds. Depositing the funds is fairly easy, and is typically done via a bank wire transfer, which takes up to 5 days (usually 1) to complete.
6. Start trading as closely to your strategy as possible. Don't deviate from your guidelines by pursuing apparently great trading opportunities. In the heat of a trading day you may overlook the risks and lose money.Do not be too rigid, either. If some of the presumptions on which you based your strategy are proven wrong (e.g., new economic data emerges), adjust your trading accordingly. If your strategy does not bring you a consistent profit, revise it. Don't forget to test the revised strategy on a demo account before venturing into the real world with it.