Forex trading, investing or speculating?

Forex trading became easy to access with the arrival of online brokers ten years ago. Some people start trading to make money fast, others enter more cautiously with more reasonable, long-term profitability expectations. So in forex trading is it speculation or a real investment over time?

Speculate in the short term

Practicing short-term trading with market positions lasting from minutes to hours is very common. This is called the practice of scalping or day trading. This type of trading is considered more speculative and allows you to take advantage of small variations in the courts. Traders who trade markets in this way use strategies such as range trading, for example, or trading key psychological price levels (pivotal points, supports and resistances) just as might be done on long-term charts. However, here the volatility of the results may be more evident and the emotions related to trading such as stress more present. Short-term speculation is common among individuals, but it also requires a certain availability and therefore is not suitable for everyone.

Here is an example of a short-term trading session in video format, where our trader Fab generated $ 79 in profit in less than an hour of trading. This will give you a good overview of how to trade in the short term and how to generate profits quickly.

The long-term investment

If the view is a long-term return on investment when you start trading, then switching to swing trading or position trading seems most suitable. The goal here is to tap into the major underlying trends for several weeks or even several months in the financial markets.

Another possibility that equates more to long-term passive investing is to switch to social trading. You can very well spend 10 minutes a week on social trading to monitor and select traders or diversify your portfolio, which allows you to set aside minimal time for potentially high investment returns. CopyFunds, which looks more like an investment within investment funds, can also be considered a long-term and rather conservative investment.

Forex trading with the broker Etoro

After reading this article, you should agree that forex trading is speculation but also investment. It all really depends on what you want to do with the business. Regardless of your trading perspective, it is essential that you go to a licensed forex broker to use a reliable trading platform. Etoro is an example of an authorized and recommended broker and opening an Etoro account is possible starting from only € 200 deposit, this also entitles you to the Forexagone Guarantee.

Disclaimer:

eToro is a multi-asset platform that offers both stocks and cryptocurrency investments, as well as CFD trading.

Keep in mind that CFDs are complex instruments and come with a high risk of losing money quickly due to leverage. 67% of retail investor accounts lose money when trading CFDs with this provider. You have to ask yourself if you understand how CFDs work and if you can afford to take the high risk of losing your money.

Past performance is not indicative of future results. The trading history presented is less than 5 full years and may not be sufficient as a basis for an investment decision.

Copy trading is a portfolio management service, provided by eToro (Europe) Ltd., which is authorized and regulated by the Cyprus Securities and Exchange Commission.

Cryptocurrencies are volatile instruments that can fluctuate significantly in a very short period of time and therefore are not suitable for all investors. Aside from CFDs, cryptocurrency trading is unregulated and therefore not overseen by any EU regulatory framework.

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