Forex trading is a field where your success depends largely on your own actions – with little practice and unrealistic goals, you are likely to fail, while hard work and determination can put you on the fast track to success. Still, reported numbers of those that give up on trading fall somewhere in the 70% – 90% percentile. This might make trading sound difficult, but the truth is that many of the reasons why others quit can be avoided quite easily.
Reason #1: It’s Too Hard
Some people make trading sound easy. For those that have been doing it for a long time, it feels more natural and it’s easier to make the right split-second decisions. Beginners need to realize that starting out can be difficult, however, no matter how easy your colleagues or advertisements online make it seem. This doesn’t mean that you have to be very intelligent to trade, only that it takes a large investment of time to learn everything you need to know. From there, you also need to keep up with the news and continue to do research from time to time.
Some people give up once they realize how much they need to learn because they are looking for an easy way to make money. Don’t make the mistake of thinking that you can sign up for a trading account and make money quickly if you don’t feel like putting in the effort. Trading is a real way that you can make money from home, but it is not a way to get rich quickly without effort.
Reason #2: Unrealistic Expectations
Maybe someone quit their job under the notion that trading would become their new source of income. Or you might need to make a certain amount of money within a given timeframe. Whatever the reason, some people start out with high expectations or make the mistake of setting the exact monetary goals they want to reach by a certain date. This can set you up for failure because it’s difficult to predict exactly how much you could make while trading thanks to all of the different factors that affect the market.
Your money goals also need to keep your initial deposit in mind – if you’re hoping to make a living trading, you’ll need to deposit at least a few thousand dollars. You can’t come in expecting to make a living off of a $100 deposit. When people set these goals and can’t meet them, they tend to become discouraged and move on to the next thing. Remember that setting goals is important, but you should focus on the short-term as well and think about improving yourself as a trader in the beginning. These healthy goals will make a better impact on your profits and your brain will thank you for the dopamine reward when you manage to reach your realistic goals.
Reason #3: Their Balance Hits Zero
We all enter the field of trading to make money, but things don’t always go as planned. Beginners are more likely to make avoidable mistakes, like risking too much on each trade, setting their leverage too high, forgetting to exit a trade, or being oblivious to trading psychology. If these things lead to a blown account, it can be difficult to bring themselves to invest more money because their new mindset tells them that they just aren’t good at trading or that it isn’t profitable. If this happens to you, don’t give up. It’s just a sign that you need to spend more time researching and practicing before you try again. Try opening a demo account if you haven’t already or taking trading quizzes to really test your knowledge if you’re apprehensive about making a second deposit.