Forex. Who wants to be a millionaire? Myths and reality.
Is it possible to become a millionaire on Forex? This question is usually asked by everyone who enters the world of Forex, often trying on the image of a financial power broker.
But can an average man without special skills get rich by trading on the currency market? Opinions are divided on the matter.
Some of them are sure it is real, the others assure that it is not, it is impossible. In their opinion Forex is a false promo and very doubtful kind of making money on the Internet and one has to be wary of it.
But if you put aside the extreme views and do not listen to others' opinions, and think logically, involving ordinary mathematics, you can come to some interesting conclusions.
The road from trader to honorary millionaire
First of all, let's define the terminology, what it means to be rich and how much income it is limited to. Probably one million dollars is a sufficient amount to feel quite confident in this world and obtain the proud title of "honorary millionaire. Let's try to calculate the possibilities and time for an ordinary Forex trader to reach this objective.
Let's assume that a trader-beginner was trained in one of dealing centres and learned the basics of Forex trading. Though, it is more realistic to say that the education of a serious trader is not limited to the courses provided by the brokerage company only. He will be looking for different ways to improve his skills permanently or at least until his trading system becomes a relatively lossless Forex strategy.
Three stages of becoming a millionaire
Nevertheless, how much a trader can earn at the beginning of his career? Not much. You can say that he is very lucky if he is profitable at all in the first months and even years. A trader's way consists of three development stages. The first one - sad as it may sound - is the account loss, and seldom has anyone ever escaped this fate, and the second is the near-zero balance, when there is no more margin call, but for some reason there is no profit either. And, finally, the third stage, which not all beginners come to, is direct profit from trading on Forex.
Let's assume that the novice trader was initially well-trained and skipped the first disappointing stage. He can probably expect to make some profit. Taking into account the effect of a small start, let us assume that he will be able to go from $100 to >$3000 in the first few years. Thereafter, the trader's fate is complex and hardly predictable. But nevertheless, let us assume that our character is not a beginner any more and he/she earns 50% of his/her deposit for a year. Is it much or not?
In my view, a 10% profit a month is already a good and real profit in the Internet trading. Let's not take into account monthly doubling of our deposit. These figures are also quite real, but they are not typical for most market players and such revenues are often not stable. Let's take into account that the trader takes a part of profit for his own needs, and sometimes he has periods of unsuccessful trading, or he is sick, resting, or just lazy in trading. So, 50% for a year.
How long will it take him to earn a million? About 15 years. Long fifteen years he will work, and work, not play the stock market tycoon, for the sake of making his dream a colourful reality. The truth and the goal is worth it. Therefore, theoretically, it is quite possible to become a Forex millionaire.
The practice shows the opposite. Most of traders do not think of Forex trading as a laborious and tedious job, business, entrepreneurship. They need much, immediately, now and to go to the goal for a long time, they just can not and do not want to. As a rule, such quick starts end up with a quick finish, and the myth of earning big money on the currency market is still a myth for most of us.
Those desiring fast profits are better off trying their luck at casinos. Most likely the effect will be greater there. Forex trading is a type of the Internet business. And to treat this type of income should be treated accordingly. The income comes exclusively through the knowledge, experience and labor of the trader.