Is it possible to start trading FOREX with $1000?

DianaR · #41 11-07-2008, 06:32 PM

Originally Posted by 1time

Just graduated from college and looking to start trading the FOREX markets. Ive been looking into brokers and seems like FOREX brokers offer huge leverage. They also guarantee my stops so I can only lose what I put in. Any advice on a sufficient capital for trading?

Even if you could, should you?

Probably not right now. Now is the time for you to build a nice stash of money to see you through tough times and low paying jobs while the worlds' economies settle down.

sevensa · #42 11-07-2008, 07:41 PM

Originally Posted by DianaR

Even if you could, should you?

Probably not right now. Now is the time for you to build a nice stash of money to see you through tough times and low paying jobs while the worlds' economies settle down.

Please see my post above. The question is over two years old and the original poster not been around for over two years as well.

walterw · #43 11-11-2008, 08:02 AM

Originally Posted by walterw

screentime, screntime, screentime , monday to monday and monday to monday plus RRR (RISK REWARD RATIO) Ã‚Â¡Ã‚Â¡Ã‚Â¡ you need to make good gains and small stops... cant get out of a trade winning little, cant afford to trade with such great big stops... so screentime, screentime, screentime.... it is possible... really doesnt matter much wich technique, its important that the technique you choose has a good RRR included on its plan.... maybe... after 6 months of succesfull paper trading, you can start thinking of real money trading....

so so true chimp... cheers Walter.

MightyMouse · #44 11-19-2008, 09:23 PM

With $1000, I'd probably want to trade other things like stocks or maybe currency etf's which move in lockstep with the currencies. if you learn to make money trading those, then it's a matter of adding funds and risk to trade the cash or futures currency markets. My guess is you've already made your mind up. Good luck.

walterw · #45 11-20-2008, 08:21 AM

Well yes , you can start with $1000 forex trading , why not ? and if you become consistent in making 10 pips per day, that sums up pretty quick... Its a good idea to prove yourself as a good and stable trader with small amounts, then volume on your acct its a by-product of consistency... cheers Walter.

PD: consistency demands a simple method... when things get too complicated its very dificult to be consistent.

trader_john · #46 11-20-2008, 10:21 AM

I've found that with a small account, the impact of bad habits and mistakes are magnified. Some examples:

you may close trades that go against you before your plan calls for them to be closed
you may close winning trades prematurely
overtrading will kill you in commissions (stocks/options/futures)
opening a long when you meant to open a short could wipe you out (or worse)
thinking you closed a trade when you didn't could wipe you out (or worse)

On the bright side, it might be more difficult to double your position rather than flattening it since you may reach your account limit.

That said, Forex seems like the most practical for small account active trading since you only have to overcome the spread, no commissions on top. The thing to watch out for is a big whip and complete destruction.
As an alternative, you could use a sim such as papermoney from thinkorswim while you build a stake.

John

daedalus · #47 11-20-2008, 10:30 AM

My opinion. Do it. But don't open your account with 1000.00. Expect, FULLY EXPECT to LOSE everything you deposit. So if you only have 1000.00, you should deposit 50 bucks with Oanda into a MICRO account. That way you can trade LIVE, not DEMO from the get go and risk a minimal amount of money. You screw up and lose it all, you get to start over again 20x's. If you can take the 50.00 to 100.00 consider repeating that a couple times before you can even consider putting any money up front.

People always say you need a lot of capital to start. I disagree on the basis that if you TRULY know what you're doing and are consistently successful you should be able to grow any amount of money into any amount of money. The difference is starting small requires MUCH MUCH MUCH more discipline and consistency over the long run to make any appreciable growth.

You don't need 20k to start if you are a consistently profitable trader. Its not about the capital in my opinion, its about the consistency. Does more capital = more "buffer" room before your out looking for a job again? Sure. But you don't need to 20k to buffer your losses if you're already good enough not to make them. And if you're not good enough to not make them then you've got no purpose to be trading with 20k in your trading account.

Deposit 50 bucks. Learn. Lose due to YOU (not your method) screwing up. Repeat until step 3 is absent. Go from there.

Just don't DEMO. There is so much talk about demo trading, we tell everyone new to trading to DEMO DEMO DEMO. Then they do with their 50k practice account, they make 2-3k a day and think they got it all figured out and the Ferrari is gonna be in the garage by the end of the month. Then they go live with their 5k and its wiped from their account faster than they can say "I Don't know what the hell i'm doing". Much of this is due to the psychological aspects of trading, fear of loss, greed, anger, all of it. And it surfaces as soon as you put real money on the line. So what you need to do is never take the easy route and Demo. Use live money from day one so your actions ALWAYS have a consequence and you don't get to write off stupidity as "oh, well at least it was only a demo account".

Go out and buy Trading in the Zone by Mark Douglas. Read it twice before you place a trade. It would've saved me thousands if I had read it prior to trading. It is all about the psychological / emotional aspect of trading. That is what will be the hardest thing for 99% of trading to master. A trading method is easy. Pulling the trigger, managing a trade without emotion, and taking profit without fear or greed entering into the equation is the hard part.

Hope this helps!

walterw · #48 11-21-2008, 07:50 AM

A true professional trader should give same importance and technical focus whatever the acct size is... once you have a solid method ( wich is key for success) ... it doesnt matter if it is 100 bucks or a millon, if you want to succeed, you are not playing... you are trading... can you still enjoy trading ? jajaja, well yes, depending in your method... chimps do enjoy ¡¡ cheers Walter.

MightyMouse · #49 11-21-2008, 09:28 AM

Originally Posted by trader_john

I've found that with a small account, the impact of bad habits and mistakes are magnified. Some examples:

you may close trades that go against you before your plan calls for them to be closed
you may close winning trades prematurely
overtrading will kill you in commissions (stocks/options/futures)
opening a long when you meant to open a short could wipe you out (or worse)
thinking you closed a trade when you didn't could wipe you out (or worse)

On the bright side, it might be more difficult to double your position rather than flattening it since you may reach your account limit.

That said, Forex seems like the most practical for small account active trading since you only have to overcome the spread, no commissions on top. The thing to watch out for is a big whip and complete destruction.
As an alternative, you could use a sim such as papermoney from thinkorswim while you build a stake.

John

Trader John ,
you don't need a small account and do not need to be inexperienced to make those mistakes.

mrgreen · #50 11-23-2008, 10:09 AM

I agree with all you posted but this. A new trader doesn't have the synaptic highways to understand what Mark Douglas or for that matter any book detailing a subject they have never experienced. IN this instance the emotional ups and downs of trading. After one has traded for a year or two they can get much more out of this book. If someone read this when they started to trade they should reread it again now that they have experienced what it is talking about. Actually it's worth putting on your cal to read once a year.

Originally Posted by daedalus

Go out and buy Trading in the Zone by Mark Douglas. Read it twice before you place a trade. It would've saved me thousands if I had read it prior to trading. It is all about the psychological / emotional aspect of trading. That is what will be the hardest thing for 99% of trading to master. A trading method is easy. Pulling the trigger, managing a trade without emotion, and taking profit without fear or greed entering into the equation is the hard part.