Is it possible to start trading FOREX with $1000?

[tlfx 10]

IMHO $1000 is more than enough to start trading in forex since forex have mini and micro lot accounts. But of course it's hard to make a good money with just $1000 but you can use it to learn especially how to control your emotion since demo trading is different. I heard this one trader can turn $5 into $4000 in a few months! So yeah, $1000 is more than enough to start trading in forex

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Just my opinion...

[fxlabrat 10]

I only have $100. But i saw an EA can make around 10% daily. So if i compound my money i'll get $1000's in a few months... wish i have $1000 at least.

[Hlm 10]

This reminds me to buy a lottery ticket when I get gas today. I mean, it is possible that a $1 ticket could be worth 200k if not millions.

 

But to be serious, is $1000 enough to start trading FOREX...because of the ability to trade pennies on the pip, technically yes it is. However, your profit is going to be porpotional to that (pennies on the pip) if you trade with solid money mangement that wouldn't be different if you were trading ten times that.

[BlowFish 10]

I only have $100. But i saw an EA can make around 10% daily. So if i compound my money i'll get $1000's in a few months... wish i have $1000 at least.

 

 

With a small bank roll it is probably prudent to examine how much they can loose before making that 10%. Thats if you buy in to there claims in the first place. Neglect risk of ruin at your peril.

[rangerdoc 13]

Another contrarian viewpoint here... I think it's a great idea.

 

Much better to start with $1000 trading micro lots & losing it all than to deposit $20-30K like other suggest and losing all of it.

 

It's essential to discover what type of trading fits you best. I personally don't believe you can accurately find this out with a practice account. Paper accounts just don't screw with your emotions enough to be of value.

 

I say,

1) Open a micro account with a market maker (FYI, if you're trading anything less than $100,000 lots then you are trading with a market maker even if they tell you differently).

2) Try really hard not to lose it all.

3) Lose it all.

 

Hopefully, after completing these three steps, you will have learned a few things like:

A)What types of trading fit you best. Fast, slow, in-between. Are you an impatient person who is a nervous wreck if you have a trade open overnight.. do you lose sleep in this scenario? Or are you a rather disciplined patient person who would rather take your time making calculated decisions, then sit back and watch it develop?

B)Trading may be simple, but it sure ain't easy.

c)That the earlier posts were right... you are going to have to learn how to trade. This will take lots of time.

D)That you are the weakest link in the trading process.

E) You may even discover that trading isn't for you. No shame in that. Just like everyone isn't meant to be a pro athlete or musician.

 

If you walk away from your first account with this knowledge, then your $1000 taught you more than any book, video or course could.

 

Once you figure this out definitively, only then can you develop a methodology that has a snowballs-chance-in-hell of making money for you. You've probably heard this over and over by now: Almost any system will make money in the right hands. 90% of your success or failure is in the 7lbs of grey matter between your ears, not in any external thing like a system, broker or which market you trade.

To illustrate this, I once heard Eddie Van Halen pick up a cheap department store piece-of-crap guitar and play it. You know what? It sounded freakin' awesome. Now, put Eddie's guitar in my hands... you know what? It will sound like a piece-of-crap dept. store junker. yet the world is full of amateur musicians who are constantly chasing the latest gear, equipment and techniques, when all they really need is simply years of practice. Sound familiar? Just replace "musicians" with "traders" and you have an accurate description of the trading industry.

If you are really wise you will take this to heart. If not, then you will have to follow in the footsteps of millions of losers before you. Which is to first buy a system, then build a system, then build zillions of different systems. Once all these have failed you, then you may finally start to realize that the problem is you, not the systems. There are plenty of threads on here about the typical progression that traders make as they develop. There's lifetimes of experience in these forums. (Unfortunately, lots of it is buried in mounds of horse s#!t). Dig through it and you'll find gold.

 

Fact: You are NOT going to take $1000 and turn it into a million. Even with world-class rates of return, it would take decades to turn this amount of money into anything of value. The pressure to get above normal rates of return because your account is so small will ruin your chances for survival, even if you practice good money management by trading micro lots.

 

And the absolute best advice I could give you...

has nothing to do with trading....

drumroll please....

Stay out of debt or get out of debt. Most people in America make enough money in their lifetimes to retire very comfortably, yet almost all retire broke instead. Why? Because of debt.

It's much easier to trade for a living if you only need $20,000 a year to live on. Contrast that to most people who's lifestyles demand an income of $60-100K per year just to stay afloat. Which do you think has a better chance at trading for a living?

If you can't do this first, then it is a good indication that you have psychological or emotional issues with money. If you do not fix those first, they WILL manifest themselves in you trading behavior in very nasty ways. I promise.

if the whole reason you want to trade is to live a comfortable lifestyle, then this last piece of advice is enough alone. But if that is not good enough.. if you'd rather gouge out your eyes with a toothpick than have to work for someone else for the rest of your life, than trading may be one option.

 

All the posts here have been excellent. If you're not scared away yet, I say go for it!

[Guest 4-ex]

Yes it is possible!!!

[jf2000 10]

Yes it is possible but make sure that you set very tight stops.

[sevensa 10]

Yes it is possible but make sure that you set very tight stops.

 

I think this is one of the biggest misconceptions to think that you should adjust your stops based on your account size. The market doesn't care that you have a small or large account. If you determine that a good stop would be 20 pips away from your entry, there is no point placing it 10 pips away just because you have small account. You might think you are more conservative, but in reality this is much riskier and you have a higher probality to get stopped out of a good trade.

[BlowFish 10]

What Svensa said. It is arguable that the only thing account size should influence is position size.

 

With mini lots and micro lots its absolutely feasible to start with $1k. Just don't expect to be making a living with 10p bets! Having said that compounding will get you there albeit later than if you start with more.

[SwingTradinJay 10]

If you're a young and tough trader who's already learned the "lessons" then 1-2k should be enough to make some spare money, but it would be very hard to live on the profits (unless you can get by with 12k a year!).

 

If an edge works with 100k there's no reason why you cant rack up profits on a smaller amount. It actually takes more composure and skill to trade smaller amounts (because there is no luxury of losing 500-2k a day).

 

It's like Limit Hold em, you need strict rules on your betting size. Short stacks only play good hands and shouldn't go all in unless the hand is likely the best at the table. Keep your bets limited to THE LEAST AMOUNT OF LEVERAGE! 1k can get you 100k lot in FX, but I wouldnt go over ONE 10k mini lot.

 

20 points is a good enough range for stops.

 

You will make mistakes, but you don't want to pay much for your errors, you'll need to be able to take the next trade without flinching.

 

Edit: This all assumes you've "learned" the key lessons and mental approach. The limited working capitol means all the ODDS are HEAVILY against you. As Bob Parsons said in the April Playboy,

 

"My experiences have taught me to be flexible, not to accept what life gives you at face value and never to make decisions out of fear. You come up with something you think will work, then you put everything you have into it. When times get tough you judge what your worst case scenario is, assume it's going to happen and get back to work. Anything you get on top of that is gravy, baby."

 

That will help to accept the risk in any business venture and thus succeed.

Edited March 23, 2009 by SwingTradinJay

[sevensa 10]

If an edge works with 100k there's no reason why you cant rack up profits on a smaller amount. It actually takes more composure and skill to trade smaller amounts (because there is no luxury of losing 500-2k a day).

 

Why do you say that? If you have a solid trading plan, why would it take more skill and composure to follow your plan with a small account instead of a large account?

 

20 points is a good enough range for stops.

 

Based on what? Wouldn't that depend on your style of trading?

[masonmorales12 10]

Though Variable spreads snowball limits and protective stops inadvertently and if the gap between Bid and Ask reach a stop or limit level, this may cause a conditional order. The trader is faced with an extra variable to be considered. This does not happen with fixed variables as there is synchronization between Bid and Ask. Fixed spreads are steady allowing the trader to be aware of levels and parameters giving way to specified money management and strategic planning to better the situation.

[SwingTradinJay 10]

Why do you say that? If you have a solid trading plan, why would it take more skill and composure to follow your plan with a small account instead of a large account?

 

 

 

Based on what? Wouldn't that depend on your style of trading?

 

 

Why are you quoting me? Those questions are easy enough to figure out...I said it takes more composure, which is separate from having a technical edge...It means you're under even more control and emotional constraint.

 

I said 20 pips for stops because that's based off of my style. So whatever floats your boat dude and its all dependent on your style and time frame. What I should have said was, have a ratio around 1:1-1:4 in that range, If you REALLY wanna get technical...So a scalper may risk 10 to make 20 or 30. Swinger may risk 100 to make 300 etc etc.

Figure it out for yourself svensa. No need to be a Donkey.

There's no right way to trade, my advice is merely my opinion after 3 years of being in the market(s).

 

OP should know it is possible, but you DO need to play it tight and very controlled. Get the most bang for your buck.:missy:

[sevensa 10]

Why are you quoting me? Those questions are easy enough to figure out...I said it takes more composure, which is separate from having a technical edge...It means you're under even more control and emotional constraint.

 

I said 20 pips for stops because that's based off of my style. So whatever floats your boat dude and its all dependent on your style and time frame. What I should have said was, have a ratio around 1:1-1:4 in that range, If you REALLY wanna get technical...So a scalper may risk 10 to make 20 or 30. Swinger may risk 100 to make 300 etc etc.

Figure it out for yourself svensa. No need to be a Donkey.

There's no right way to trade, my advice is merely my opinion after 3 years of being in the market(s).

 

OP should know it is possible, but you DO need to play it tight and very controlled. Get the most bang for your buck.:missy:

 

I have quoted you because I was responding to you and because you made blanket statements without providing any context. Making a statement that 20 pips is enough for stops, without providing any context, or considering the trading style, makes no sense and does not help anyone. You have only provided the context in saying that this is how you trade in your response to my post.

[SwingTradinJay 10]

Gotcha

 

back to backtesting zzzz.....

[Jene 10]

Well there is no specific definition about capital requires to start forex trading. it differs from person to person and most importantly it depends mostly on the amount of preparation they have. if a person is having suitable amount of preparation can start with decent amount but this case can't be applicable to those traders who have just started knowing what is forex is all about.

[pathfinder62 10]

Deb...

 

Hey, EZ. Keep runnin' the jaws or keyboard keys all you want. That was one terrific "Virgin Buster" of a reply. More like that anytime you want... Tomaz M.// pathfinder 62

 

I have read the various responses to you here of late and I have a few observations.

 

First, what is the driving force behind your desire to trade Forex versus perhaps the e-mini futures markets?

[agd108 10]

$1000 is really the minimum and is kind of where I want to trade. I want to start with microlots. So if you trade 1 microlot with a 50 pip stop it is 0.5%, that is the real way to trade. If I can consistently trade like that, I want to move up. Wish me luck, may take me a few years.

[fxscalper 10]

You can start trading with $25 if you want. You won't make a living. But you can start to trade trade.

[pedropips 10]

If you can master managing you money, cut losses and let winners run then even 100 dollars is good to trade. You won't make a lot of money at first but if you are patient, build your account and compound then you'll be rich in no time. This is assuming you know how to trade and you have mastered you fear and greed

 

Although a lot of people here 'strongly' suggest to have more capital, the way I see it is that if you can't make money with a small amount, you'll never make it with a big amount. Start small and grow big. That's what I did and now I trade like a robot, no emotion ... well not much anyway but doing well :P

[pathfinder62 10]

Another contrarian viewpoint here... I think it's a great idea.

 

Much better to start with $1000 trading micro lots & losing it all than to deposit $20-30K like other suggest and losing all of it....

 

... you're not scared away yet, I say go for it!

-----------------------------------

Rangerdoc: that post from Jan of this year is absolutely one of the best responses to trading advice I have seen in almost 15 years on the internet. I just hope the youngsters that view it take and APPLY even one grain of your sage advice: it will save them countless thousands of dollars, hours and grief over the years.

 

Great stuff/ H. T.

[hedonQ 10]

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?

 

 

You might be misdirecting your focus. I don't think you should worry about leverage. It sounds like you already have profitable setups and the necessary trading skills to succeed in trading.

 

Find a methodology and setups based on the methodology. Trade it on demo, see if you can maintain some positive expectancy over time.

 

I understand the excitement and wanted to trade real money. Been there done that. But think about a brain surgeon performing an operation on your head. And he just graduated from college in liberal arts.

 

I think no broker offers leverage more than 100:1 since November this year (in US that is, a gift from NFA).

Good Luck.

[Aaron137 10]

I started trading with $100 using a micro account. You can do it for less. Demo trade is a good way to start, although there is no emotional attachment to the risk of virtual money. If you cannot afford to lose less than $100 study charts and demo trade.

[marketwavez 10]

I started trading with $100 using a micro account. You can do it for less. Demo trade is a good way to start, although there is no emotional attachment to the risk of virtual money. If you cannot afford to lose less than $100 study charts and demo trade.

 

What about trading a Micro account or Nano account with your $100 ?

 

Micro account trades at .10c pip

 

 

Nano account trades at .01c pip

[Aaron137 10]

I'd go Nano if you can - I think you can open one with $25.