Forex Education - 3 Vital Tips to Make Money Fast in 2008

By: Kelly Price

As we turn into the New Year it's a good time to make changes and take action - if you are trader who is not doing well or a potential trader then these 2 tips will help you make money fast not just in 2008 but at anytime and they should be a cornerstone of your forex education.

The first point I want to make needs serious thought 95% of traders lose money not because they can't learn forex trading (anyone can) but because they believe certain myths and commonly accepted wisdoms that are wrong.

The tips below are not conventional but don't let that worry you the bulk of traders don't make money so being in the minority is good so here are your 3 tips

1. Be Patient Trade Less

Many traders think the more they trade the more they will win but this is simply not true in forex trading in fact the opposite is true - the more you trade the greater the chances are you will lose.

You don't get paid for the effort or amount of trades you make - you get paid for being RIGHT that's it. I know traders who trade every day and make nothing and others who trade a few times a year and make over 100% annualized gains!

The majority of novice traders believe the day trade and make money myth and that's all it is a myth. Day traders don't make money period.

If you don't believe me, try and find a real track record on a day trading system and you will be looking for ever. You have to catch the big high odds moves and they can ONLY be spotted by looking at longer term data and data within a day is meaningless.

If you like the buzz of trading you will lose - if you are patient and wait for high odds trades you will win.

2. Diversification

You will have heard it countless times diversify; don't put all your eggs in one basket etc. On a small account of $1,000 or less you don't have enough to diversify and make big gains at the same time.

All diversification does is dilute gains - wait for the big moves and load them up with as much as you can afford.

3. Take Bigger Risks

You will hear many give you the advice of only risking a maximum of 2% on a trade - well on 1,000.00 that's $20 you won't make much doing that!

Wait for the good trades and load them and risk up to 20% on a small account.

You can only diversify and risk less per trade if you have enough cash and that's $10,000 + if you don't you need to risk more - period!

4. Have Courage

Learn to accept big gains!

Hang on you may say all traders can do that because that's why their trading currencies.

They are - but they don't understand accepting a big gain is harder than taking a loss.

Why?

Because as soon as a trader sees a profit he wants to take it and the bigger it becomes the harder the temptation is to resist. As open equity swings keep eating his open profit it becomes too much and he snatches a mediocre or minor gain.

What happens next? The trade goes on to make 10,000 20,000 or more and he's not in.

If you want to make money you need to have courage and accept that open equity will eat into your profits and have confidence to hold for a bigger longer term gain.

If you want to make more money from your forex trading and you are starting off with a small account make the above part of your forex education and you will see your profits increase dramatically.



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