How to get started in Forex

Is it possible to make money with Forex? Sure, it’s not impossible, but it’s not that simple either. Find out how to start investing in currencies and protect your money.

Those who are new to online trading often approach forex with this question: how to make money? You may already know how the stock market works, but the forex market has a slightly different mechanism.

To win with forex, you will not have to buy and sell stocks, but exchange one currency for another in search of the most advantageous exchange rate. You will need a little patience and a lot of practice – you can’t expect to get everything right away.

Don’t even expect forex to be a surefire win. How much does a forex trader really make from his business? It depends on his skills, the time he devotes to trading and the forex broker chosen to trade currencies.

This beginner’s guide on how to make money with forex will answer all these questions and give you some operational tips to start investing with currencies gradually.

Making money with online forex: which broker?

To trade forex online, you will need to open a trading account with a regulated broker in France that will allow you to invest in currencies with CFDs. Is very important choose the best CFD broker to start trading online.

What is forex

Forex (short for Foreign Exchange, abbreviated to fx) is the financial market where buyers and sellers trade currencies. In the past it was reserved only for institutional subjects, such as banks, governments and multinationals, while now single investors can participate, investing for speculative purposes (exchange rate gains).

The foreign exchange market is “over the counter” (OTC), meaning it is not in a physical location. The exchanges are made only electronically, from Sunday to Friday evening, on a continuous basis.

How does a forex trader make money?

Due to continuous events around the world, the value of one currency suddenly changes relative to others. All trade in goods and services between countries must necessarily go through the buying and selling of currencies, which makes forex one of the most fermented financial markets.

Not just that. The value of the currency is also affected by geopolitical events, the choices of central banks, financial crises and the speculative operations of millions of traders.

In this context, to win, a forex trader must anticipate these changes, with the simultaneous purchase of one currency and the sale of another.

How Much Can You Earn in Forex Trading?

The volume of forex earnings is an issue that affects many novice traders. The correct answer is that there are no income limits: potentially those who invest in the forex market can pocket billions of dollars.

While the gains are theoretically unlimited, investing in the forex market can also lead to big losses. Forex, like the stock market, is characterized by high price volatility, which can generate profit opportunities but also expose the invested capital to risk.

Remember: Forex does not mean safe income, much less monthly income.

The vast majority of forex trading accounts turn negative within the first few months of trading. The reason? A novice trader does not have the right experience to easily trade the currency market with CFDs.

An investor can be considered an expert if he manages to obtain a monthly gain of 3 to 5% of his capital on the foreign exchange market, which can mean an increase of about 40-60% over the year. But even then, there is no fixed or secure income.

Earning with Forex Trading: 4 Practical Tips

To be successful with forex trading, there is no real secret recipe. Everyone has their own strategy, goals and operates in a market full of surprises and unexpected events.

However, there are 4 good rules of conduct to follow to gradually enter the forex market and try to win:

  • Clear the illusions: Forex brings real, but dangerous gains;
  • Proceed with patience, practicing much earlier on the demo account;
  • Learn about forex: study, take courses, read;
  • Start trading forex from the most traded pairs.

1. Forex is not safe money

We have already said it, but it is worth repeating: there is no certain income. Beware of those who tell you otherwise, it takes patience and study to get results.

In forex you can earn huge sums, it is not impossible, but only after having really learned the secrets. And even after many years of business, it is not certain that you will always be able to make a profit.

2. Start with the forex demo account

Winning with forex first of all means minimizing your losses, especially if you have just approached the world of online investments. A forex demo account is the best choice for practicing without burning your savings.

Choose one of the forex demonstration platforms, register for free and use virtual funds for your simulations. These brokers allow you to earn in the currency market through CFDs, thus also operating with leverage or downwards.

3. Study and shape

By taking your tests by buying and selling currencies, you cannot expect to learn automatically. Sure, demo simulations help, but they are much more effective when combined with a good financial education.

For example, have you ever thought about taking a beginner’s forex trading course? You will quickly learn how the currency market works, how much and how to make money with forex, but also how to implement your investment strategy and more.

4. Know the most traded currency pairs

Ready to make money as a forex trader? A good tip is to start with the most traded currency pairs: these are those of the most stable countries, with low inflation and less risk of sudden devaluations.

Try starting for example by exchanging the EUR / USD exchange rate. Keep an eye on the chart in real time, follow market trends and news, use technical tools and your knowledge of technical analysis.

So, when you see fit, open a buy (long) or sell (short) position. CFD brokers also allow you to trade with leverage, increase the volume of your investment, or invest on the short side, or bet on the fall of the euro against the dollar.

Forex and taxes

Finally, to calculate how much you earn with forex, you will also need to take into account the taxes. In France, the law provides for a 30% tax rate on the proceeds of any financial investment, therefore also on currencies.

These forex earnings must be reported in the year-to-year income model and paid for in income.

Haven’t you made any real gains from forex? You are therefore not required to pay taxes, but if you have an open trading account with a foreign broker (eToro, Plus500, Iq Option or similar), you will still have to declare that you have sums abroad.

Frequent questions

  • How much can you earn with forex CFDs? Earnings in Forex depend on market trends and have no limits in theory. Furthermore, if you trade with a CFD broker, you can also invest downward and trade with leverage, increasing the scope of your investment by up to 30x.
  • Is it possible to make money with Forex? Millions of investors invest every day in creating currency and losing money. However, in order to earn real money, you need to follow some rules, choose the best broker and practice a lot.
  • What are the strategies for making money with Forex? Forex traders use technical and fundamental analysis to analyze the most traded currency pairs and speculate on changes. Take beginner courses and training to increase your chances of making money with forex.

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