How long does it take to become profitable in currency trading?
An article looking at how long it takes to get an edge and become profitable on the forex market.
Currency trading is one profession where it is easy to make money, but very hard to be profitable in the long term. People make money this week and in the next week they are mourning their losses. In this article we will be looking at how long it takes to become consistently profitable in forex trading, and how much time you will likely need to spend as a beginner before you start making money.
The truth is that just like most things in currency trading, there’s definitive answer to this question. Success in trading varies from one person to the other. The one thing everyone agrees on is that it does take time to learn the ropes.
What does it mean to be successful in currency trading?
Being successful in currency trading means you have got to the stage where you can withdraw decent money at the end of every month as your profit. This means you can comfortably take trades knowing fully well that at the end of the month, your winning trades will take surpass your losing trades. For some traders, it takes as long as 2 years to get to this stage; some people trade for 5 years and consistently lose. At the other end of the spectrum there are traders who learn fast and stick to a profitable strategy and are profitable in months.
Factors that affect speed of success in currency trading
- Devoting enough time to learning forex trading:
Most traders jump into currency trading way too early. As soon as they have read a few e-books, and looked at one or two indicators, they quickly fund their trading account and go live. Often the trader will blow the trading account in just a few months and then will keep depositing more money for as long as he can afford till the learning process is completed. Many give up half way and end up with a negative perception of forex. When traders spend at least 3 months reading the theoretical part of trading and another 3 months on demo trading it is far more likely that the trader will:
a) Become successful
b) Get there within a year..
- Discipline to stick to what was learnt
Discipline, or lack of it, goes a long way in determining the trader’s success. It is one thing to learn and develop a trading strategy; it is another thing to actually stick to what is learnt. Changing trading strategy too often is a common problem. Successful traders will tell you that their trading strategy is a consistent. If you have the required discipline it is only a matter of time before you get to that “state of profit”.
The higher you go, the cooler it becomes. An individual with a $1000 account may need as many as 1000 pips to turn decent profit; but by the time you grow the account to $10,000 a month, 500 pips will make you pretty happy!