Defining how much money you will have to start forex trading for a living is a complex process and there is no shortcuts exist. The main and most deadly mistake that traders make in choosing to go “full-time” is under-capitalization. This will be your “patient zero” of faults, which will spawn all others. It’s important to remember that the number of money traders available to them will significantly affect their ability to succeed in forex trading.
Forex trading won’t take your $10,000 trading account and convert it into $1 million. The amount that we can gain is calculated more by the amount of money that we risk than by how effective our strategy is. The old phrase: “It takes money to make money” is a specific one that involves forex trading. But it doesn’t mean this endeavor isn’t worthwhile. However, there are a lot of successful Forex traders out there that trade for living life. The difference is that, over time, they have grown steadily and increased their account amount to a point that can create sustainable profits.
Because of the leverage available, forex traders may make a return on one trade which is multiple of the margin they used it to open the trade Although leverage is a double-edged sword since huge gains can also mean huge losses. And depending on undue leverage as a tactic usually leads to long-term destruction of your account equity. Because it takes only one unfavorable market change to drive the market very far and cause significant losses.
The truth of forex is that millions are unlikely to be made by trading a small amount in a short time frame. Although profits can collect and grow over time, small-account traders often feel under pressure to use high amounts of leverage or take on risks to quickly build up their accounts. To put it in perspective, experienced fund managers with millions of dollars at their fingertips frequently make less than 10 percent to 15 percent per month, which means the concept FX traders with small accounts might make double, triple or even 10 times their account in a single month is somewhat misguided.
Forex market trading is a long-term task. It takes many years, not weeks or months, to make a profit consistently. Armed with that knowledge, taking things up slowly becomes much easier. Start with 1000$ and Keep your position small and concentrate on good setups, instead of trying to trade each day. In the end, determining if you have enough to start the trading ends up looking at what you predict from the Forex market, and what kind of risks you’re ready to take. If you are looking for quick profits, but have small money, and are conservative by nature you will probably not achieve your goals.