Most traders have heard or read that 95% of forex beginners do not make money. This is a very common myth widely spread on the internet. Furthermore, this myth is not based on verifiable statistics and unfortunately, it prevents many traders from reaching their full potential by creating an unnecessary and harmful trading fear.
What Are the Chances of a Forex Beginner to be Successful
Basically, there are always traders who make money in forex. In theory, for every loser there is a winner. However, earning money regularly is another story. In the long term, there are fewer winners than losers. Also, 95% of traders are not professional full-time traders, but that does not mean they do not make money. A forex trader does not need to be professional; in fact the unrealistic hope of becoming a pro trader is often an obstacle to success as often investors trade with too much leverage to rapidly increase their profits.
The goal of the novice trader should be to make small profits regularly. A trader who increases his capital each month for an extended period is a profitable trader who gradually gains confidence from his negotiating skills. He is not yet a professional, but profitable. Thus, with the goal of making a small profit each month, the chances of success are statistically quite high. With more experience on forex, the trader will then set a weekly target before eventually becoming a professional trading.
By practicing regularly and seriously realistic and systematic trading, the trader refines his strategy and steadily increases his capital. The novice trader must make a distinction between professional trading or full-time and part-time profitable trading. Traders who do not aim to become professionals, but just to earn some extra money are more likely to succeed in the foreign exchange market in the long term. The psychology of the trader is a very important element, a trader who has no ambition to become a professional in the early stages is in a much better emotional state. Having realistic expectations results in the trader being more objective and consequently not use high leverage and increased funds, because the main goal is not to live from trading, but only to generate an additional monthly income. The fact of having no pressure and not relying on trading to ensure a lifestyle can play a significant role on the psychological factor. As a result this will have a positive impact on the quality of the trades and the rational amount of invested money. Significantly minimizing the emotional element is the easiest and fastest way to be successful in forex trading as this is most often the reason to failure. Given that it is possible to trade currencies profitably part-time, statistics of people who actually generate profits each month is probably closer to 20 to 30% and perhaps even more.
In conclusion, we need to stress the fact that, the chances for the novice investor to become a profitable forex trader are excellent if the ambition of becoming a professional immediately does not come in the way. Initially, a beginner should just expect to win consistently, regardless of the amount of profit. This mentality increases the chances of success, because it gives a realistic goal avoiding the common trader's mistakes of speculating hastily in order to live from forex trading. Consequently it's best for beginners to establish a part-time trading plan.