To make money on the foreign exchange market you have to buy less And sell high, fairly simple. is forex trading profitable how much money can you make trading forex
Let’s take a look at the example:
How much money can you theoretically earn by trading currencies?
Suppose you have the US $ 1,000 on your trading account. Euro vs US Dollar current exchange rate Is 1.25. In other words, for 1 euro You get one dollar and 25 cents. You anticipate During that day there will be an increase in the euro versus the US dollar. Based on this forecast you buy 800 euros For his $ 1,000. Your prediction is correct!
The euro rises from 1.25 to $ 1.26.
Being in profit you decide to close the trade and exchange 800 euros back to $ 1,008. In effect, Your profit from this trade is 8 dollars. Not only that, is it?
You raise a pertinent question:
Will it be possible to increase profits You can use leverage to maximize your profit potential. Leverage is a loan that Tickmill offers you To trade foreign exchange. Loan size may vary but Tickmill offers you 500 times more money than your initial capital, Which increases your profit potential by 500 times. Great, right? anyway, please remember …
Taking advantage of growth not only means more profit potential But more risk too! Managing your risks is very important! Let’s look at an example of how to use the leverage One to five hundred (1: 500). Your account has the same $ 1,000 And you predict that the euro will rise against the US dollar So you decide to get the largest possible loan from your broker for $ 499,000.
Now, with an exchange rate of 1.25, You exchange all your $ 500,000 to 400,000 euros. At the moment when the exchange rate increased to 1.26, You exchange 400,000 euros back for $ 504,000. As a result, you now have $ 5,000 in your account After returning the loan to your broker. So your net profit is 4 000 dollars.
An incredible result after just one day of business!
In this example, we have looked at the scenario at the time of your forecast. Is corrected. But what if there was a place to get up Did the euro fall against the US dollar? in this matter, Your business will remain open until your losses equal your initial deposit, Which is $ 1,000. At this point, your business will be Automatically closed and the broker withdraws the loan. As a result, The case when you can lose a broker loan is almost impossible.
Keeping everything in mind, now that you have seen how leverage can increase your profit If you make the right decision. At the same time, leverage can also work against you.
If you make a miscalculation and do not limit your losses. Tell me why I trust that Tickmill: Tickmill likes to see customers succeed in trading.
Your funds are safe and separate Tickmill’s low foreign exchange spread (or the difference between the buy and sell price) increases your profitability.
You can test your trading skills on global markets with a small initial deposit of $ 100 You can avail of up to 1: 500 (one to five hundred) Tickmill allows all trading strategies including scaling, News trades arbitrates and executes trades in a very short period of time. This is why Tikamil is highly respected in the Forex community.
Visit our website www.tickmill.com to learn more!