Forex trading continues to gain in popularity year after year. The reasons why are varied, but in most cases, it boils down to the ease of entry into the Forex trading career and the potential for profits.
But is it wise for these traders to try for a career as a Forex trader, or is it better to remain part-time and keep your day job?
Let’s find out.
The Advantages of a Forex Trading Career
Full-time Forex traders are chained to an office chair for specific hours of the day. The Forex markets trade 24 hours a day and 5 ½ days a week. That means full-time Forex traders can make their own schedules. It also means they can take a break whenever they like and don’t have to worry about a long and stressful commute to and from work each day. People with kids and other family responsibilities are sure to find the flexibility of a Forex trader’s career to be extremely useful.
Easy to Get Started
Putting yourself on the career path to be a Forex trader is pretty easy. You don’t need any degree or specialised training, and you can start with minimal capital if you’re willing to keep your day job for a bit. You will need to educate yourself, and you’ll need an internet connection and computer, but that’s about it.
Another excellent advantage to becoming a full-time Forex trader is the low costs. There are no fees or commissions to deal with as a Forex trader since the brokers in this industry typically make their profits from the spread on each currency pair. That does away with typical brokerage charges that stock and commodity traders might have to deal with. So, this might not necessarily be an advantage over your current full-time job, but it is an advantage for trading Forex over other financial instruments. Read more about Forex Taxation.
A Liquid Market
With a trading volume of $6.6 trillion daily, the Forex markets are by far the most liquid financial markets. It also has the largest number of participants, and this combination certainly has its advantages. For one thing, you aren’t likely to find any price manipulation in the Forex market. Pricing is extremely efficient in all the major and minor pairs and in most of the exotic pairs as well. This means that unless there is some exceptional news that impacts the markets, you can see clear price patterns unfolding regularly in the Forex markets.
Again, this might not be considered an advantage over your current full-time job, but it is an advantage over other types of traders.
Many Technologies and Strategies
If you are considering a career as a Forex trader, it makes sense that you are also interested in finance and currency trading to begin with. So, you’re probably already aware of the wide array of tools and technologies that can be used to explore the world of trading. It’s unlikely you’ll ever get to explore them all if you’re working for a company. It can be dull and tedious to always follow strict guidelines and rules in your trading, but full-time traders are free to explore and learn as many different strategies as they like. You can also explore the different trading tools available, like robots, expert advisors and automated trading systems. On top of it all, when you’re free to trade on you can develop your own style and flair in trading that meshes with your own personality. When you are trading in tandem with your own personality, it becomes far easier to know what to do in your strategies. Making the most of the technologies and strategies available might help you reach your goals, but it’s fairly certain you’ll never have such freedom when working for someone else.
The Cool Factor
Let’s face it, telling people you trade Forex for a living is just plain cool. They won’t know what tough work it is, but you can take satisfaction in knowing you’ve become one of the few who were able to overcome the hurdles to make a career from Forex trading.
The Disadvantages of a Forex Trading Career
Of course, becoming a full-time Forex trader isn’t all greatness. There are also some issues that might turn you off from a career as a Forex trader.
It Takes Time & Effort
If you think you can make a career of Forex trading without time and effort involved, think again. Of course, anything worth having takes time and effort, so this isn’t necessarily a disadvantage, but it is something to consider before embarking on a career as a Forex trader. You can certainly achieve freedom and wealth from trading Forex, but before you do, you will dedicate much of your time to learning how to trade properly, successfully, and profitably. It will be time you might want to spend in leisure or with your family, but you will need to make the necessary sacrifices that all successful Forex traders have made to get to the point where they have freedom. Whatever you do, make sure you understand the level of commitment and amount of time it will take to make a career from Forex trading.
This might be the biggest disadvantage of a Forex trading career, especially if you aren’t comfortable with trading risk. If your career is Forex trading and you hit on a losing streak, there’s no paycheck coming at the end of the month to bail you out. You are responsible for yourself and that can cause problems if you don’t know how to manage your trading risk. Fortunately, there are many risk management strategies you can learn that will help you manage the risks that come with a Forex trading career.
This goes hand in hand with risk. While you may think your day job now is boring, tedious, and monotonous, at least it’s stable. You know a paycheck is coming at the end of the month, and you probably have health insurance and paid leave. You might even have some sort of pension to look forward to, or at least a retirement scheme that’s subsidised by your employer. You won’t have any of that as a career Forex trader. You won’t even know what each month’s earnings will be like. That’s almost the direct opposite of stability, and if that scares you, then this is a huge disadvantage. On the other hand, some of you won’t be bothered with this or might even thrive under such circumstances.
Unfortunately, there is a fair amount of fraud out there in the Forex industry. There are dishonest brokers and the equivalent of snake oil salesmen peddling all sorts of forex scams with shady robots, indicators, and signals. And it’s a guarantee that if they get their hands on your money, there’s no force under the sky that will get it back for you. You’ll be on your own to do the research and due diligence required for every single business and individual you deal with. Trust no one and nothing, and you won’t be disappointed. Fortunately, trading with a large and reputable broker like AvaTrade, which is regulated across the globe can save you a lot of heartache later.
So, can you really make a career from Forex trading? Absolutely you can. It’s been done by others, so why not by you as well.
You might be surprised at the number of people in technical or engineering jobs and in middle management who are either considering a career as a Forex trader, or who have already made the transition. Thanks to our modern world, computers, and the Internet, anyone has the opportunity to try and make a good living by trading Forex. And it’s become completely acceptable for people to make a career change to take advantage of any opportunities. However, you must always factor in the risks. Trading is risky and you should never trade more than you can afford to lose.
Do remember that a career in trading Forex is not going to be easy, but it can be extremely rewarding. You’ll be the master of your own destiny, and will have the freedom to explore all the diverse techniques and strategies that a Forex trading career has to offer. You’ll learn how to work hard, how to be consistent, and how to manage both risks and money.
There will be some disadvantages as well, but if you’re aware of them, going into a Forex trading career they should be surmountable. And remember too that there’s no huge rush to become wildly successful overnight. Most people take at least 10 years to become successful overnight, so feel free to take your time.
Many beginners will quit during the early phases, but if you start you should hold on and give yourself the chance to become successful. You’ll have some setbacks and losses in those early days, everyone does, but that’s simply a part of the learning process in the transition to a Forex trading career.