Making the choice to become a forex trader can be an exciting one that causes many traders to feel eager about getting started. This is especially true if you’re feeling inspired after talking with a colleague who might have mentioned how much money they make trading, read an article that makes trading sound easy, watched a video that promotes the luxurious lifestyle trading can provide, and so on.
Unfortunately, you won’t be ready to open a trading account immediately, no matter how eager you’re feeling. Opening a trading account too soon is actually one of the top mistakes that beginners make and can lead you to lose your money altogether. This often causes traders to give up out of frustration before they really even get the chance to get off to a good start.
So, how long does it take until you’re ready to start trading? The answer differs for everyone and will mostly depend on how fast of a learner you are, along with the amount of time you have to spend brushing up on your trading education. There’s a lot to know, including these topics and more:
- Forex terminology (leverage, stop-loss, pip, margin, etc.)
- Forex basics
- Forex mechanics (navigating a trading platform, placing a trade, exiting a trade, etc.)
- Factors that affect prices in the forex market
- Trading psychology
- Risk-management (setting a stop-loss, how much to risk on each trade, etc.)
- Trading strategies (scalping, swing trading, day trading, etc.)
Each of the above topics can go into a lot more detail, for example, if you’re learning about trading psychology, you’ll want to learn about overconfidence, the way fear affects trading decisions, analysis paralysis, trading when you’re on a losing streak, and much more. You should expect to spend a great deal of time studying these topics to ensure that you completely understand everything you need to know.
If you’re in a hurry, we suggest devoting as much time as you can to learning. If you work or attend school full-time, you could try researching in the evenings and on weekends, or anytime you have a chance. This is the best way to fast-track your education, but remember not to let yourself get burnt out before you begin trading. Even if you have a large amount of money burning a hole in your pocket, you have to remind yourself that investing too soon might cause you to lose everything.
Instead, learn when you can and hold on to your money. One good way to check your progress is to test out your knowledge by taking free forex quizzes online or to try a hands-on approach by opening a demo account. Both options will allow you to see if you’re ready to begin trading or if you need to spend a little more time learning.
In conclusion, we’re sorry to say that we can’t provide you with an exact timeline of how long it takes to become a trader, but this article should help you gain an idea of what you need to know and how to prepare yourself. Some traders might invest a lot of time into researching and be prepared in a week, while others might take longer to learn and could take a month or more to prepare. We can assure you that you won’t be ready to start trading overnight, however. Know that investing too early is a risky mistake that is likely to cause you to lose money.
If you hold onto your money or even allow it to accumulate while you learn and wait to open a trading account until you’re truly ready, then you can ensure that you’re starting out on the road to trading success.