UNITED STATES—The popularity of forex trading in California has reached such fervor, MeetUp now has its own dedicated networking groups with more than a dozen within 25 miles of Beverly Hills. True, trading has a certain glamour associated with it, making it an attractive endeavor for young professionals with entrepreneurial spirit. But, the rise in foreign exchange trading amongst idealistic Californians is as much about testing analytical skill, market knowledge and courage as it is about making money.
Now one of the “trendiest” markets for retail traders, forex appeals because it’s not just for experienced traders but beginners too. In fact, unlike most markets where only substantial sums of money will suffice, you can begin forex trading with as little as $100. Here, we detail a few tips to get you started.
The Advantages of Forex for the Beginner
Forex has grown in prominence with new traders because of its scale (it is the world’s largest form of exchange, trading $4 trillion every day) and is open to both institutions and individuals alike. More and more people are choosing the market because there are no clearing fees, no middlemen, and no fixed lot size. You don’t have to worry about someone cornering the market, transaction costs are low, and the market is open 24 hours. And, by leveraging, a small deposit can control a much larger total contract value.
Understand Your Goals
Before beginning, have clear goals and understand that each trading style has a different risk profile. If you’re an insomniac, then you won’t have to worry about trading during the small hours but, if you value your sleep, consider sticking to day trading, for example. If you’re prepared for the long haul, be a “position trader” if you believe you’ll benefit from appreciation of a trade over months or even years.
Get The Right Broker
Brokers differ. Research a number of brokers to get an idea of their reputation and style. Over-the-counter trading differs from exchange-driven markets, for example, just as a trading platform might not be suitable for the analysis you want to do. The combination of a good broker with the right platform for you is the ideal balance.
Train With Those That Know
There are lots of places in California to learn how to improve your trading expertise. In Los Angeles, the Online Trading Academy, which has locations in Woodland Hills and Westwood, was set up in 1997 to help investors make smarter trading decisions. As well as classes specifically dedicated to forex, the Academy has experienced trainers in a range of assets such as equities, options, futures, wealth management and real estate.
Experience Opens Up New Opportunities
With experience in forex trading comes confidence (and some more capital to play with). Those that have a strong understanding of different markets, and the courage for potentially high-risk investments, can access dedicated platforms that give advanced traders access to a variety of forex pairs across majors, minors, exotics and metals and a multitude of market aids like trade signals, timely data and innovative risk-management tools.
The biggest mistake a beginner can make is to be unrealistic. Forex trading is not straightforward and isn’t a get-rich-quick scheme. Get to know the way the market works, the key terminology, and the risks involved before investing. And maybe consider a networking group near to you for further tips, insight and the sharing of ideas.
