Making money on Forex - how to start earning money from scratch?

Working in Forex attracts thousands of people. It allows you to trade without leaving your home, make money on exchange rates and significantly fuel your family budget. However, all this is achievable only if the novice trader takes preparation and training seriously, knows the basic principles of work, and knows how to apply analytical methods. In addition, the psychological attitude is also important - the trader must be serious, focused on work and not chase excess profits to the detriment of the formed strategy. This article will talk about how to start working on Forex and immediately start making money, protect yourself from significant losses and - perhaps - make your income from trading your main one.

Earning Features

Just a decade ago, only a few people understood exchange rates.
Nowadays, making money on stock exchanges is available to almost every person, due to the possibility of online learning and the absence of the need to invest large sums. But making money on Forex requires knowledge, special skills and experience in determining the benefits of changes in exchange rates. Therefore, most come to the conclusion that this method of getting rich is a myth invented by experienced scammers for consumers who do not understand the nuances of making money. People often ask what Forex is and how to make money on it. We are talking about the sale and subsequent purchase of currency or the same shares in the hope of making a profit due to changes in their exchange rate value on the market; the rules for entering and exiting a transaction are prescribed within a system managed by a trained specialist.

In the 21st century traders and brokers do not just play on the stock exchange, but also work honestly.

Their profit is based on the presence of such components as:

Market knowledge. The trading mechanism is automated, but for a person acting on his own initiative and seeking to make a profit directly from this process, it is important to be able to understand indicators and various complex graphical systems. It is important to follow economic news. Make decisions immediately, but carefully. Otherwise, trading on the stock exchange will not bring profit.
Practice. It is important to be aware of how to develop your own working methods. Trading strategies appear every day, but it becomes more difficult to analyze the incoming information. Therefore, good earnings on Forex depend on the quality of development of practical skills.
Experience. Over time, traders learn to read charts correctly, which helps them grow their profits.

Some banking structures organize free entry to the exchange and offer currency exchange for those who contact them for the service, perform additional transactions, receiving a profit as a percentage of the transactions carried out. For such financial institutions, it does not matter whether a trader trades in plus or minus. For them, only the size of the commission matters.

The bank's income is much higher than that of the dealing center. As a result, banks can guarantee the payment of profit to traders, incl. at the expense of its own numerous assets.

What is Forex in simple words

Forex is an international over-the-counter foreign exchange market. The currencies of most existing countries are traded on it; the price is formed based on current supply and demand.

Forex market participants are:

central banks of different countries;
private banks;
brokerage and dealing centers;
Insurance companies;
public and private pension funds;
investment funds;
private investors;
traders.

The market itself was formed at the turn of 1970-1980 and since then has shown continuous growth in capitalization. This fact is confirmed by studies of the Bank for International Settlements, which are conducted every 3 years.

Dynamics of daily turnover growth (According to reports from the Bank for International Settlements)

The graph shows that between 2001 and 2016, daily turnover increased almost 5 times. According to leading economists, by 2020-2021 the amount of day trades could reach $10 trillion.

Forex is a system without any center. Its stable operation is ensured by:

brokers;
dealers;
liquidity providers.

Each element of the system performs its own task. Brokers receive and withdraw orders from traders, dealers receive quotes from suppliers and accept bids from clients, suppliers directly transmit quotes and provide contracts.

There is no single center for trading (like a specialized exchange), just as there is no official Forex website.

Is it possible to make money on Forex and is it really possible to do it without investments?

Beginners ask how to start making money on the Forex market. It is important to have trading capital if you want to earn income quickly and in large quantities. But there are also options for earning money without financial risks.

1) But in this case, experience in trading securities and knowledge of the rules of operation are necessary. Believing in yourself is also important. If such components are present, the trader can already advise beginning traders and receive commissions from their income on the exchange.

To earn large sums, it is important to systematically analyze the market situation. In this case, laziness and fatigue can cause immediate regression.

2) Another way to earn money without investments is to attract sponsors/investors who open an account and deposit funds into it. And the trader, a currency or securities trader, uses this money to carry out transactions. The profit received is divided based on mutual agreements. In most cases, the investor receives 60%. When it is possible to reach a fixed income, it becomes easier to invite sponsors, so the trader’s profit will increase.

It is impossible to work on the stock exchange without investments, but if certain conditions are met, the trader may have funds on deposit that are not his own.

conclusions

Trading on Forex is an interesting, exciting and at the same time quite complex area that can rightfully be called work. With a serious approach, an experienced trader can increase his capital, but passion and thoughtless transactions can wipe out the largest deposit.

If you decide to try your hand at Forex, you need to carry out thorough preparation. Study theoretical materials and articles posted on major investment portals, understand for yourself the structure of the work and your capabilities. Then learn the basics of trading - you can do it yourself and absolutely free, you only need a demo account and educational literature. And only when you feel the strength to start real trading, it’s time to choose a broker and place money on deposit. And we hope that our advice will help you make the right choice.

How to make money by trading: step-by-step instructions for beginners

After learning the basics of working on the stock exchange, you need to read the instructions.

Step 1: choosing a broker

Experts recommend using the following criteria to compare brokers:

Duration of activity of the specialist. There is no need to start cooperating with those whose period of trading on the exchange is less than 3 years. It is important to check the availability of documents confirming official registration and permitting work on the stock exchange as a broker.
Rating. It is better to cooperate with those organizations that are in positions 1 to 10. - See our rating of Brokers ⇒
The amount of financial investment should be minimal.
Bonuses.
Quality of service. You should pay attention to the politeness of the support staff. Customer service is the support offered to customers before, during and after they purchase or use your products or services. A high level of this service is critical if you want to maintain your existing customer base and grow your business.

Step 2: installing the program and selecting a financial instrument

Before you start trading, you need to install a trading platform. Most often they prefer the MetaTrader terminal.

The merchant must have a good understanding of the software, having first carefully studied the functionality of the platform.

The next step is choosing a currency pair. Experts recommend sticking to EUR/USD. And when experience is gained, you can conduct transactions with 2-3 financial instruments.

Step 3: Practice on a demo account

A demo account is a training account, similar to a real one, but with virtual money.
The first one was created as a trial version to familiarize yourself with the system and test its functions; the real one was created directly for working with existing capital. Real and demo accounts have the same characteristics and rights. The only difference is that in the trial version it is impossible to lose capital. Using a demo account, it is convenient to test the effectiveness of various strategies and gradually create your own trading system. After creating such a system, testing it and obtaining good virtual results, you can safely start trading binary options.

Step 4: Open a Real Account

If you have achieved good results by trading for at least 1 month on a demo account, and after that have shown stable positive results on a cent account for at least 3 months, then it’s time to switch to a real Forex account and start making money.

To open a Forex trading account, you need to select a leverage (preferably 1:100 or 1:200) and account currency (USD).

Step 5: Achieving Break-Even Trading

In order to achieve higher performance, it is important to choose exactly your Forex strategy (it should suit you and like it). For example, install the simplest Forex indicators on the chart of a currency pair with USD, for example GBP USD the following indicators:

BearsPower (13), for clarity we color it red.
BullsPower (13), for clarity we color it green

Rules taken from the “Powerful Tool” strategy ⇒

Step 6: Making your first profit

A good trader can be called not one who managed to increase his wealth several times over a short period of time, but one who receives commissions over a long period and demonstrates a gradual increase in it, subject to high-quality risk management.
Therefore, it is important to develop your own strategy by analyzing the results obtained.

Step 7: increasing your deposit

With a deposit of $200 per month you can earn $30-40 with good market volatility. Therefore, you can start trading on Forex with 600-1500 dollars. If you don’t have that kind of money, you should try to increase the deposit yourself, but this option is fraught with high risks and it’s better to do it gradually!

The importance of the right mental attitude

Until now, we have talked a lot about theoretical training, the ability to analyze data of various kinds (mathematical, statistical, economic), and draw the right conclusions. But all this may not matter if your character traits do not correspond to the image of a “correct” trader. It is an inappropriate psychological attitude and a frivolous attitude towards Forex trading that can make the best strategy unprofitable, and turn you away from exchange trading and trading on quotes forever.

So, what personality traits does a successful trader need?

Take trading seriously. You should treat Forex as an ordinary job and not regard it as a game for money - otherwise losses are inevitable.
Sober calculation and composure are the main character traits. Excitement, greed, and stinginess can play a bad joke on a novice trader - you either fail to take profits on time, or wait until a “sagging” position destroys the entire deposit. Miracles rarely happen.
Self-discipline. You yourself determine how much time you can devote to the stock exchange, because in this job there are no bosses or daily routine. If, after turning on the computer, you are constantly distracted by other matters, personal correspondence and devote catastrophically little time to trading itself, then it is difficult to expect that your earnings will grow.
A keen interest in trading is the key to professional growth. Seminars, training courses, independent study of news, forums and all available information increase your level of knowledge. If calculations, numbers and charts make you bored, then Forex is not for you.
Willingness to spend money. It is worth understanding that large incomes require significant investments, and a deposit of 5-10 dollars will never turn into millions.
The ability to plan is the main quality, because any trader needs a clear strategy. At the same time, you must not only draw up a plan, but also be able to stick to it, without being distracted by momentary weaknesses and not chasing “easy” money.
Self-confidence (not to be confused with self-confidence) is the main quality of successful and accomplished traders. If you know your conclusions are correct, act immediately - otherwise someone else will.
Analytical thinking. To draw conclusions, you need to be able to analyze information - this is obvious. YOU may not have a background in economics or mathematics, but data analysis and logical thinking skills are a must.

Personal example of making money - a real story, 4 golden rules for beginners

Traders often share their stories of how to make money in the Forex market. Visitors to our website very often send reports from real accounts, where they have doubled their capital or more thanks to the developed strategy.

Here is one example, and there are a huge number of them on the site:

You can check out some of them here:

for Individual 2-month training ⇒
according to BF2 strategy ⇒
according to a strategy with a guarantee of earnings ⇒

A personal example of making money on Forex allows us to highlight 4 rules necessary to achieve success.

⚠ The most important rules of Forex trading

There are a number of such rules:

Controlling emotions through the use of a clear trading system or indicators, but it is equally important to control yourself in terms of money management. This applies to traders who like to unreasonably raise rates or increase the investment amount. To overcome emotionality, a precise plan is needed that determines when and how much the stakes can be raised and, conversely, when the stakes should be lowered.
Management of risks. For this purpose, it is recommended to set a stop loss (an exchange order placed in a trading terminal by a trader or investor in order to limit their losses when the price reaches a predetermined level).
Continuous learning. It is recommended to find a mentor who will provide supervision and assistance in trading securities or forex.
Execute sales following a well-thought-out plan.

What are some good trading books to read?

There are a huge number of books from famous authors that will teach you how to use technical methods to predict price movements in markets and successful financial transactions. The books are a basic guide to technical analysis of financial instruments. The literature is specialized for both novice players and experienced specialists in the exchange and over-the-counter markets.

see post Recommended reading

What earnings depend on - 5 important factors influencing a trader’s income

Making money on the Internet is fraught with risk, but there are factors that allow you to increase your profit to $1,000 in just 3 months when you deposit $500 into your account.

Factor 1. Competent choice of trading strategy

We are talking about short-term trading.
This is a style of trading where trades are opened and closed within 1-2 days. It is also called intraday trading. Here we use charts that consist of bars up to 1 hour. Additionally, this type of trading includes scalping (short-term holding of positions with a profit rate of several ticks). Medium-term trading involves using less leverage than, for example, the same intraday trading. This is due to the fact that the ranges of value movement in each position that is open are much larger. And if you use high leverage, then there is a high risk of closing the transaction on a margin call (the broker's requirement that the client deposit additional collateral into his account). This strategy is recommended by experts.

Factor 2. Strategy effectiveness

It is recommended to choose Trading Made Simple for a number of reasons, such as:

Brings 65-75% positive transactions on a regular basis.
Shows excellent trading results after midnight.
Uses 3 indicators to confirm entry.
Minimizes the presence of a trader near the monitor.
Best suited for medium-term trading.
Good entry points at the beginning of the European and American trading sessions.

Factor 3. Volatility level

We are talking about a statistical financial indicator characterized by price variability. Expected volatility includes its current performance and projected changes in risks in the future. Various factors influencing the cost are added to the calculation of the expected financial indicator.

Factor 4. Amount of capital invested in the account

Money management is the ability to make a profit, even if the number of unprofitable and profitable transactions is almost the same.
Therefore, it is important to carefully familiarize yourself with its principles to achieve positive dynamics. Some sites offer not only instructions, but also an online money management calculator for calculating positions, allowing you to potentially determine profit and loss in advance.

Factor 5. Stress resistance

How to make money on Forex from scratch - the answer lies in increasing stress resistance, which requires a lot of work on yourself and personal development. In this case, the problem is not solved locally.

Stress resistance largely depends on the following personal characteristics:

Locus of control. Conventionally, people are divided into 2 types: the first, in case of failures, look for their cause in the external influence of various factors, the second prefer to take responsibility for their lives upon themselves. It is important for a trader to learn to identify the reasons for failure in order to achieve good results in his work.
Self-esteem. Working on yourself, developing your skills and achieving goals is the basis for high self-esteem. And even if everything does not always go smoothly, the understanding that you did everything possible will not allow you to feel regrets and feel guilty.

You should seek help from a psychologist if you want to become a broker, but are aware of a low level of self-esteem and the inability to help yourself on your own.

Fear and greed are the main enemies of successful stock trading.

Continuing the topic of the psychology of stock trading, one cannot fail to mention two very dangerous traps for a trader - fear and greed.

Fear is a natural human reaction that occurs when faced with potential danger.

In Forex, fear most often manifests itself in situations when a trader logically understands that it is here, at this moment, that he needs to enter a trade, but is emotionally afraid to do so. As a result, he misses a profitable opportunity and does not receive potential profit.

Greed is an equally common psychological state when a person overestimates his strength and strives to get as much as possible at any cost, regardless of the dangers.

In stock trading, greed manifests itself in excessive self-confidence, neglecting the obvious dangers of losing existing profits or not closing a losing position.

The consequence of greed at a certain stage can be hope. This is another state when a trader sits and “prays” that his profit will grow or the transaction will turn in the right direction if there is an unreasonable minus on the position he opened.

As mentioned above, fear and greed are just our psychological state. But psychology sometimes plays a cruel joke on us. So that psychological aspects do not prevent us from working productively on the stock exchange, there is one main rule:

Always work according to the system!

That is, open trades when you have clear logical reasons for this and close them also when a clear signal has been received through your trading system.

Don't leave things to chance. After all, this is how most traders lose their money.

Before entering a position, you must have a clear action plan for how and under what circumstances you will exit it. This system is called a trading strategy.

By following these simple recommendations, you will greatly increase your chances of success.

What you need to start earning money from scratch - 7 useful tips, review of the best brokers

Brokers and traders provide information about whether it is possible to make money on Forex. There are 7 ways.

Tip #1. Don't neglect training on a virtual account

A demo account is an opportunity to learn the structure, interface, and navigation features of a brokerage firm’s website without making a financial investment. This service is in demand among beginners who can gradually develop their betting skills without risk.

Experienced securities traders also use demo accounts when there is a need to test a new strategy. The ability to transact online helps customers of all skill levels to place real money bets without stress.

Tip #2. Keep a trading journal regularly

Using a trading journal helps you find weaknesses in trading techniques and the psychology of the trader himself, and also facilitates the development of a model that allows you to avoid losing your deposit.

The classic trader's journal contains the following columns:

Date of.
Time (transactions).
Volume (trading lot).
Basis for the transaction.

Tip #3. Conduct market analysis regularly

By conducting market analysis, you can collect valuable data that will help you better understand your customers, determine appropriate pricing, and identify weak points among competitors.

Tip #4. Control your emotional state

Instead of reacting to the situation immediately, think about what tools and solutions you can use.

Cool down and reflect on what happened, regaining your focus and ability to analyze. Hasty decisions most often bring a bitter feeling of regret.

Tip #5. Choose the right trading strategy

It is recommended to copy the strategies of experienced traders until you learn to develop your own ways of making successful trades. There are more than 500 of them on this site, choose any one!

Tip #6. Do not deposit a lot of funds at once

To avoid losing money, it is better to practice with small amounts.

Tip #7. Take your choice of broker seriously

Each broker must comply with the legal standards for the operation of financial organizations established in the country. Accuracy in executing customer orders is important. There should be no operational errors with accounts. A trader must have a good understanding of the selection of financial instruments for trading and investment.

Based on reviews, we can conclude that such aspects that determine the quality of a broker’s work, such as the level of its commissions and the minimum amounts for opening a brokerage account, are also of great importance.

Where to trade? Which broker do you recommend?

The question that is asked most often. Unfortunately, there are a lot of scams among Forex brokers. Therefore, choosing a reliable broker is very important. Personally, my main trading accounts are with Alpari. The company is old and reliable (providing services since 1998), with a good reputation. There are no problems with output, they work correctly.

Also, using our broker selection service, you can choose the company that is right for you.

When choosing a broker, it is important to carefully consider the following criteria:

Reputation and quality of work (order execution, slippage)
Terms of trade (the lower the costs, the more you earn)
Support (it is important that you can answer any questions you have, especially at the initial stage)
Software (possibility of using the application on the phone)
Security (important, conditions for depositing and withdrawing funds, identity verification procedure)

I would advise starting with an amount of at least $100, otherwise you may simply not have enough funds in your account if there is a small drawdown, without which trading is impossible.

Answers to frequently asked questions

Question 1. How can you make money on Forex without experience and knowledge?

Use the 2 methods described above: signals and advisors for MT4.

Question 2. How much can a beginner earn on Forex?

You shouldn’t count on big profits right away. Additionally, in order to earn income without experience, you will need deep knowledge of theory.

Do not neglect existing stop orders and take profits. They allow you to automate the process of closing transactions and limit losses. In addition, such orders eliminate the influence of emotions on trading.

Question 3. Why do many people think that it is impossible to make money on Forex?

Many traders suffer many small losses that simply destroy their capital. And the lack of knowledge leads to the idea that you will never be able to learn how to make money on the stock exchange. Therefore, after the first failure, newcomers begin to spread the opinion that the currency exchange is a complete fraud.

Question 4. How to get a no deposit bonus on Forex?

No Deposit Bonus up to $1000 HERE ⇒ ⇒ - to all new clients when opening their first account. To receive a bonus, you just need to enter your real data when registering and open an account.

Risk management: what is it or why most beginners lose money

We have come to an important block when working on exchanges - monetary risk management, or as it is often called “money management”, which literally translates as money management.

This is a set of fundamental rules regarding how trading capital should be distributed within trades and what should be done to avoid unplanned losses, as well as how to insure existing profits against losses.

3 important rules of risk management (money management):

Rule 1. Do not keep more than 50% of your capital in open transactions. It means that the total capital invested in all open transactions should not exceed 50% of the size of your trading account;
Rule 2: Use stop orders. Protect your profits by setting a take-profit order, which you can also move as your profitable position grows following the price. Also be sure to place a “stop-loss” order. This way you are guaranteed to protect your trading account from fatal losses;
Rule 3: Don't add to losing positions. Some traders, when a transaction goes negative, decide to buy or sell additional currency in order to average the price of the open transaction. This is how they try to save the situation and think that if the price reverses, they will close the position to zero or even make a profit. But this only goes away for the time being, until greed and hope for the best finally destroy the account of the unfortunate speculator. After all, at the moment of averaging, you risk losing everything 2 times faster if the price continues to move against you.

Remember that following these 3 fundamental rules of risk management will bring your stability and profitability in the stock game as quickly as possible.

You will find more detailed information about money management and the correct construction of trading strategies on the website of the largest Russian broker Alpari in the “Training” section.

The course is repeated periodically, so don’t be afraid to be late.

Balance between self-confidence and self-confidence

Believing in yourself is very important

. Without this, there is no point in going to the stock exchange at all. This will contribute to missing good entries due to fear of losing and causing shortfall in profit, which in total will greatly spoil the results statistics, reduce the efficiency of the trading system and lead to unnecessary stress.

All this can be avoided if you clearly define all the trading rules for yourself and simply follow them. After all, no one uses a trading algorithm without testing it on history, and if a decision is made to trade using it, then it has shown satisfactory results. This means there is no need to doubt it, simply look for suitable conditions and consistently act according to plan. Indecision can cause you to miss a good signal simply because everything looks too good.

The downside to this situation is overconfidence. As a rule, it occurs after a trader manages to trade in good plus for a sufficiently long period of time or after a one-time transaction with high leverage and a powerful movement taken. “God syndrome” appears and it begins to seem to him that he cannot be wrong. It’s better not to let things get to this point, since the market usually brings you down to the ground quite harshly afterwards. We just remember that nothing is known in advance, anything can happen, and you need to work within the framework of your trading system, without changing the key parameters - order volume, stop, take and entry signals.