How much do you need to start trading Forex?

Gone are the days when forex trading was the exclusive preserve of people with fat bank accounts.

How much do you need to start Forex? (Jason Briscoe/Unsplash)

One thing most new forex trading enthusiasts want to know is the minimum capital required to start. How much, they often ask, does one need to start trading forex.

This is a very valid question. Every business course teaches you that you need some capital to start any business, right?

Well, thankfully, the forex market is different. You need pretty much zero naira or zero dollars to start trading forex. I will say it again. You don’t need any money to start the trade.

This is good news for anyone who’s scared they’ll lose their money on the first go. It’s comforting to know that you can gain some forex trading experience without risking your hard-earned money.

Most forex trading platforms give newbies the opportunity to open a Demo account with which they can trade risk-free.

But nobody wants to dabble into forex trading just for entertainment. Everyone who trades forex does so to make money.

Forex is therefore not a video game for entertainment. It is a serious business and like most businesses, you have to invest real money to reap the profits.

There are additional questions, one should be asking when starting to trade Forex - Is it legal? Is Forex trading legit by all religions?

How much you need to start trading forex depends on some factors like the forex broker, the amount of profit you want, and your appetite for risk.

The Amount of Money you have.

The amount of money in your pocket will determine how much you will want to invest in the forex market.

The more capital a trader has, the more money he is likely to stake and invest in the forex trade.

Forex trading is a highly technical field. It requires a lot of expertise and mastery. Many investors take online courses before they eventually master how to trade forex online.

The best way to invest in forex therefore, especially for beginners, is to tread carefully by investing in small amounts and then gradually increase your stake.

The forex market is one of the easiest markets to get into. This is because unlike other markets that require huge amounts to get in, you need just a small amount to invest in the forex market.

Although there is no amount fixed as the minimum by regulatory authorities for trading forex, individual brokers have their own minimum deposits.

The safest and most realistic way to trade forex is to do so through a broker who usually prescribes the minimum deposit to trade.

While some brokers need as little as a dollar to open a forex account, others need hundreds and even thousands to trade.

The Amount of Profit you want.

Forex trade is a delicate balancing act. This is because the higher your stake, the more profit you stand to gain.

But on the other hand, the higher the risk you take by increasing your stake, the bigger your losses.

Forex trading requires patience as it takes a long time to make meaningful profits while keeping your risk levels low.

Those who want to make a substantial profit in record time are forced to take more risks by making higher stakes. It all depends on your appetite for risk.

Trading Style.

The amount a trader should stake is usually determined by the trading style of the investor. Forex traders who trade for a short period prefer to invest small amounts.

Those who are into forex for the long haul, invest much more and allow the profits to gradually accumulate and grow.

Like other businesses, forex trading has its own risks. The level of risk in forex depends on some factors including how much you started with.

As we all know, forex is dependent on the upward and downward movements of currency prices.

Those with small accounts run a higher risk of having their accounts wiped out when the market is down.

Experienced brokers who want to minimize their risk levels and maximize their leverage usually start forex trading with moderate amounts. They understand how to take calculated risks.

From our analysis, the amount of money you need to start trading forex depends on a lot of factors.

The decision on how much to invest in forex trading rests squarely with the intending investor.

If you have a lot of money, you can minimize your risks and make a considerable profit in the long run.

If on the other hand, you have little money, the only way to make a significant profit is to take higher risks.

Have you ever tried to trade in the forex market? How much did you start with? Did you open a demo account? Or did you invest real money? Please share your thoughts with us.

AUTHOR: Nonyerem Ibiam is a lawyer, content writer, and founder of LawTruly. His works have been published in Creative Writing News, 2ndkitchen, Midstreambuzz, and Timemanagement.com.

This is a featured post.

JOIN OUR PULSE COMMUNITY!

Unblock notifications in browser settings.

Eyewitness? Submit your stories now via social or:

Email: eyewitness@pulse.ng

Recommended articles

Public schools’ teachers to retire at 65 – Kogi govt

Public schools’ teachers to retire at 65 – Kogi govt

Lagos medical cooperative society launches ferries to ease traffic

Lagos medical cooperative society launches ferries to ease traffic

To mention his name is a disgrace to me - Tinubu aims dig at Obi

To mention his name is a disgrace to me - Tinubu aims dig at Obi

Fuel scarcity: FRSC decries carrying fuel in gallons on journeys

Fuel scarcity: FRSC decries carrying fuel in gallons on journeys

Buhari doesn’t ‘use and dump’ – Gambari

Buhari doesn’t ‘use and dump’ – Gambari

It’s time for APC to takeover Benue - Guber candidate

It’s time for APC to takeover Benue - Guber candidate

Police arrest suspected kidnappers of farmer, others in Ekiti

Police arrest suspected kidnappers of farmer, others in Ekiti

Stop patronising scammers, FRSC is not recruiting – Spokesman

Stop patronising scammers, FRSC is not recruiting – Spokesman

CJN says he’s happy Makinde is among anti-Atiku Governors

CJN says he’s happy Makinde is among anti-Atiku Governors

Get our Top Stories delivered to your inbox

Welcome to the Pulse Community! We will now be sending you a daily newsletter on news, entertainment and more. Also join us across all of our other channels - we love to be connected!