How To Become A Successful Forex Trader - Top Forex Traders Stories
Forex trader meaning and definition is quite simple. A person who trades currency through a decentralized market is known as forex or currency trader.
Trading the Forex market is almost similar to trade with a security market.
Currency trading market opens for all. So, anyone can trade currencies without any control of the central authority.
Moreover, the main Forex participants are the largest financial banks, investors, the largest companies, and other financial institutions. The Forex trading clock runs actively for 24 hours and 5 days a week.
Since its inception, the market is still holding its position with a huge daily turnover.
The marketplace is popular because of its amazing potentiality. Forex market is the most liquid market among all other financial markets.
As a trader, you can take advantage of this volatile market with high leverage.
In behind every success, there is a story.
So, we tried to bring a few successful Forex trader’s stories along with their lifestyle in this article. You will also get familiar with those names who are leading the market now.
Forex Trader Meaning And Definition
There are no differences between a forex trader and a currency trader. In the FX market, the main purpose is to exchange one currency for another currency.
Traders main objective is profit. However, if you exchange your currency to visit another place, outside your homeland, will not count as a trading business.
A Forex trader mainly buys and sells currency pairs in the foreign exchange market.
Traders earn profit from the price fluctuation. So, those involved with currency trading is known as the currency trader or forex trader.
Forex trading marketplace is the largest marketplace in the world.
You can earn a profit by buying the currency pair at a low rate and selling it at a high rate. This market is known as a bear-bull market effect.
Types of Forex Trader
A trader trades the market depending on the various time frame. Each time frame has its unique advantages.
To be a successful currency trader, it is wise to adopt the right trading style.
Forex trading is not a relaxing income generator. You have to work all day long, sometimes even overnight with different charts and trading news.
For being a successful Forex trader, you have to find out what trading type is suitable for you.
It is wise to stick into one trading type. There are four types of Forex traders available:
Day traders are those traders who usually close a trading position before the ending of the trading hour.
They are the short-term traders. On the other hand, they buy and sell currency pairs to gain a minimum amount of profit.
Traders place the trading order at the first hour of a day without holding their trades overnight. Therefore, day trading is a swap free trading type.
Overnight trading positions are holding by swing traders.
They hold the position at least for one day or up to several days. The trading position could be open either in the long or short term.
Technical analysis is the best tool to analyze the financial market.
Swing trading is a popular form of active trading. These types of traders cannot monitor their trading charts and price movement throughout the day.
A position trader is a type of trader who holds a position for long-term trading.
Position traders do not perform their trade actively in the forex market.
Traders open trading positions for several weeks, months or a year. By using both technical analysis and fundamental analysis, you can analyze the market movement.
The usage of fundamental analysis is to predict the future price movement of a particular trading pair.
As traders keep their position open for a long time, so the stop-loss amount is large. This trading is opposite of the day trading.
Scalpers are mainly those traders who believe in a small profit.
They hold their trading position for a very tiny moment and wait for small pips. On the same day, they sell and buy currency pairs for more than one time.
The objective is to get a small profit from the busiest period of the trading hour. To earn a profit, the trader requires an extreme focus on the trading marketplace.
The forex trading lifestyle depends on how the trader makes a profit each day.
Traders can make a smart amount with the help of real trading effort and the trading discipline. But most of the trader often search for this question-
How much can I make from forex trading?
In general, there is no accurate answer for this query. It is impossible to predict the profit amount. Income depends on the various factors. You have to keep your patience until you succeed.
Forex Trader Income
As we mentioned earlier, the Forex trading income is not fixed. The profit is counted depending on the price movement.
Each pip movement will give you a small amount of profit. As per statistical data, the average rate of return of Forex trader’s is between 1 to 10 percent per month.
However, this prediction is acceptable for professional Forex traders.
To earn a small income, you don’t need to put your all investment. Trading planning is necessary for all types of traders.
You can start with a minimum investment. Forex trading could make you rich if you follow the trading rules properly.
Invest after setting your trading goal.
Let’s come to this point- How much money do you need to trade Forex?
The minimum investment depends on your broker’s criteria.
For day traders, the wise decision is not to take risk more than 1% and a maximum of 3% on total trading capital for a single trade.
Therefore, if your trading account balance is $20,000, then you can consider $200 as your trading risk amount for a single trade.
This calculation is applicable to all types of Forex trader.
No matter what trading style you are following, it is recommended not to start trading with $10 if you want to generate your income from Forex trading.
As per many experts, for day traders, it is wise to open an account of $1000 at least.
Successful Forex Traders Stories - Forex Trader Lifestyle
There is no particular lifestyle of a trader.
You can make your living from Forex trading but, you have to do all things right.
Sufficient funding on the trading account is not only the one thing to earn smart.
There are also a few steps, which will help traders to be a successful trader.
- Traders need to control their emotion while trading with real money
- Learn how to trade Forex successfully.
- Vast knowledge of technical analysis and fundamental analysis
- Educate yourself with a proper trading education
- Know the basics of Forex trading
- Keeping all trading records to see the past and predict the future.
- Practice proper money management system
For me, selecting a trade type is the first stage of your success.
It is your selection whether you want to open a trading position in the daytime or at night.
Trader’s daily lifestyle depends on which type of trader he or she is. There are four major trading sessions depending on the trading hours.
Your trading screen is turned on depending on those sessions and your busy life starts here.
Trader starts the busiest day with a price analysis of the daily trading market.
Traders need to spend their time to make a right trading strategy after analyzing the trading market properly.
You need to keep focused on different trading news. Avoid trading when you are in a bad mood.
Professional traders start their day early in the morning if they want to open a position at the very first hour.
Their day starts with a market research. They complete their work before opening the market. This involves brain work, so you need to be very calm while trading with a particular trading pair.
Some people love to trade during the weekend. They would like to open a position when the market is closed for retail traders.
Most of the trader or if I say more than 95% of traders are interested to analyze the market at the very last day of closing hours. It shows an entire 5 days trading scenario.
If you want to hold the position overnight, then the trading strategies will be different.
How To Become a Forex Trader
Trading with the real money in the Forex market is not easy like trading with a demo account.
The live market carries a higher risk because of the real money. Take your trading seriously whenever you decide to put your money in the Fx market.
Following these steps may help you to become a good Forex trader:
Choose the right broker. It is meaningful to select a regulated trading broker.
Start with a broker who offers a tight spread, a wide range of leverage, lower commission fees, limited swap fee, and many more features.
Look out for the withdrawal process and all necessary rules.
Test the broker platform by opening a demo account. You will find tradeable underlying assets with different trading tools and indicators.
It helps you to decide which trading platform suits you. Almost all the demo account has the same operation as the live account.
You can find out the right trading strategies with the help of a demo account.
You can open a demo account for different trading brokers. it will help you to select the right broker.
Do a proper research on the Forex trading.
As we mentioned before, a demo account is the best option to practice trading.
Try to collect news from various sources and sort out the best one.
Find out the best trading system and signal for your opening position.
Use both technical and fundamental analysis depending on the trading methodology.
Try to learn from mistakes.
Your previous mistake will guide you in your next investment.
It will also help you to make a profitable trade.
Develop a proper trading plan.
It is wise not to follow other trading plans. Try to customize your own trading plan.
It will guide you what to do in next and how to do it.
The trading plan also helps traders for building a solid trading discipline.
Try to keep your emotions away from your trading. It is difficult to control emotions while trading with a live account.
However, trading emotions are bad for traders. It will hamper you to take a proper decision.
The 5 most common trading emotions are:
- Fear
- Greed
- Overtrading
- Hope
- Frustration
Trade when you feel it is the right moment for opening a position.
You have to find a suitable trading time to avoid losses.
Understand, how currency is traded in the market.
For traders, it is important to understand when to buy and sell currency pairs.
The buying price of a currency pair is always lower than the selling price.
Start with a small amount. You can lose your all money if you are not investing wisely.
You can start with a nano account or a micro account.
Successful Forex Traders In The World
It is difficult to find those people in the limelight, who are successful from their own side.
The number of successful forex traders is limited.
You can consider these people as your idol. However, these people are the major players in the Forex market.
We named a few of the major traders down below:
George Soros:
“Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected.”
Soros was born in 1930 in Budapest, Hungary. George is an Investor, hedge fund manager, author, and philanthropist. He is known as “The man who broke the Bank of England”.
George Soros is the man who earned the highest earning in one day. Moreover, he started his financial career in 1954.
In that time, he was an employee for London merchant bank Singer and Friedlander.
Successfully, in his life, he has donated more than $11 billion to various philanthropic causes and also received various legacy and awards in his lifetime.
George Soros has written many books, articles, and papers on economics, finance, stock trading, and geopolitics.
After donating $18 billion to his philanthropic agency open Society Foundations, he had a net worth of US$8.3 billion.
Stanley Druckenmiller:
“The way to build long-term returns is through the preservation of capital and home runs.”
Stanley is an investor, hedge fund manager, and philanthropist.
He was born in 1953, in Pittsburgh, Pennsylvania, United States.
From 1988-2000, he worked under George Soros as a lead portfolio manager for Quantum Fund.
Druckenmiller began his financial career in 1977 as a management trainee at Pittsburgh National Bank. The net worth is US$ 4.8 Billion.
Bill Lipschutz:
“ It’s very difficult to be different from the rest of the crowd the majority of the time, which by definition is what you’re doing if you’re a successful trader”
Lipschutz was born in 1956. He is one of the best Forex traders in the world and known as the sultan of currency.
Lipschutz is the Principal and Director of Portfolio Management, Hathersage Capital Management.
Moreover, he comes up with four tips for traders who wanted to be successful in the long run. These are:
- Pay attention to multiples
- The details are important
- Understand what the market is thinking
- Work hard and the money will follow
Bruce Kovner:
“Fundamentalists who say they are not going to pay any attention to the charts are like a doctor who says he’s not going to take a patient’s temperature.”
Bruce Kovner was born in 1945 in New York. He is an American investor, hedge fund manager, and philanthropist.
He entered into the trading business in 1977 with $3000 as his capital money. Kovner was 32 when he made his first trade.
Bruce Kovner net worth is 5.2 Billion USD. In 1983, he founded a company named Caxton Corporation.
Michael Marcus:
“Every trader has strengths and weakness. Some are good holders of winners but may hold their losers a little too long. Others may cut their winners a little short but are quick to take their losses. As long as you stick to your own style, you get the good and bad in your own approach.”
Marcus is the man who turned his $30,000 capital into $80 million. He is a commodity trader.
In the beginning, he traded currency however, he stays away from currency trading at this time. He believes that currency nowadays involves in the political situation.
He began his career in 1972. Michael learned money management from Ed Seykota.
Final Words
In this following article, we only stated a few traders name who are famous for their tremendous trading performance.
Even in the whole world, there are numerous famous traders available who do not want to come in front of the media.
Forex trading will help you to earn money from anywhere you belong. Moreover, it is easy to learn from Forex education whereas it is difficult to learn about the live Forex trading market.
Traders need to find out the right strategy to trade the most volatile Forex market.
The sooner you start the trading, the quicker you will get the result.
So, start your trading from today.
