Hi Wortibe ,
I don't mean to rain on your parade but, with respect, you are getting way ahead of yourself. Before I get onto that I agree with some of the points above :
- keep your money in the country and go with one of the better known providers such as IG Markets , FXCM Australia , Man Financial etc...
- beware leverage. In leveraged instruments like forex, options and futures you can lose your trading account , your car and your house if you don't know what you're doing
- try some of the demos - most brokers offer demo software to try.
Also don't think that you'll be "investing" in forex. With the leverage involved you'll need to become a fair dinkum day trader who closes out all positions once you've finished for the day. Otherwise you might wake up in the morning to find Mr Bernanke has pulled a stunt , sent the USD through the roof and your currency swap has gone against you bigtime and you owe far more than what you have in your account. Some vendors offer guaranteed stop losses etc.....but just an example of what you need to be thinking about.
In regards to trading in general I can speak with some degree of authority. I'm only 35 but have been studying the markets in one form or another for 20 years and have made my full time living from it since 2002. For 3 years prior to 2002 I traded during the day and worked graveyard shifts to pay the bills so I could build my trading capital. I've traded pretty much everything but forex , but the basic principles remain the same.
Here's a quote from a mate of mine posted on a trading forum. Bear in mind that this guy has moved into forex and is a fairly experienced stock trader. He's been at it for over a year and note what he says:
Thought I would update, I have been overseas for 6 weeks odd and only got back about 2 weeks ago so now I'm just getting back in the swing of things. I'm still looking at FX and getting more and more closer to being profitable as time goes on, but now I'm holding my ground which is good. I believe the FX market offers opportunities far superior to that of the stockmarket, mostly due to liquidity so I'm sticking with it. The aim and end game is to to have minimal involvement in the stock market as time goes on.
A few random thoughts...
- It's important to NOT chase prices and to be patient and wait for the ideal entry. This keeps the risk reward in check.
- With up to 6 digits in the price of a pair it is VERY easy to make mistakes.. expensive ones LOL! So I'm on the prowl for a good broker/platform where you can trade directly off the charts and amend orders simply by dragging them on the chart.
He's just getting to the point where he can hold his ground!!!
And don't worry - you are entering an area full of sharks ready to take you to the cleaners with seminars , spam , courses etc.........the only way to protect yourself is to be careful , read as much as you can and learn for yourself. There is NO HOLY GRAIL or easy way around it. Trading is one of the great challenges you'll ever take on as the human mind is programmed to do exactly the wrong thing.............that's why the miniscule number of pros are able to fleece the rest. At the level we trade at that is due to skill and decades of experience - the dodgy stuff goes on at a more institutional level.
Now - when someone asks me how much dosh they need to be a trader I tend to favour a minimum of $50k to start and $500k if you want a shot at trading for a living, and even that's a stretch. To play around - wait until you've got a few grand you can afford to lose and make sure you're on top of managing risk and then have a play. Forex gives you the opportunity to leverage your money in a huge way but , as mentioned above , this works both ways. What you need is enough money so that you can take the many,many losses you will take whilst learning and keep them to a small enough percentage of your total capital that you don't wipe yourself out. You need to become a master in the art of manipulating your own psychology to work the opposite of everyone else , become totally unemotional about money and that takes many years to perfect , so just bear that in mind.
Trading is a profession that chews up and spits out 99% of people and some very intelligent people amongst them. Don't kid yourself that it needs any less intensive training than a medical degree. I was a pharmacist by qualification and that was easy peasy in comparison. Having said that I'm now one of the bigger private traders around trading multiple seven figures and after 20 years of study I do well for myself....still a few areas to improve.
Off my soapbox now - I just don't want you or anyone else to get the idea that trading is an easy way out of the daily grind. Like any other successful self employed person you'll need to love what you do and have enough determination and experience to navigate hard times and make it count for something.
Best of luck learning the ropes. If you put time into learning and testing things out (while very carefully managing risk) it will possibly be worth your while many years down the track , so don't let any of the above discourage you. Just some perspective.