Everyone that decides to try out forex trading enters the market with goals in mind. Often times, our goals revolve around turning a profit, like making a set amount in a given timeframe or earning enough income through trading to sustain our lifestyle. Others might want to become one of the very best traders out there and to have their name associated with the likes of George Soros, Paul Tudor Jones, and other trading legends. While being ambitious and setting goals shows that one has the self-determination and positive outlook, many traders set unrealistic goals that lead to disappointment. Some traders enter the market with starry eyes, only to give up on trading for good if things don’t meet their expectations. This is why it is important to set reachable short-term goals for oneself when trading forex. Below, we will provide some real examples of what you should expect.
Have Realistic Expectations for Profits
No matter how inspired you are or what you’ve heard, you can’t expect to become rich overnight or make a lot of profits from a small deposit in forex trading. The best goal starting out is to turn a profit rather than losing money. If you do this, then you’ll be off to a better start than many others. Once you are more comfortable trading, a realistic goal would be to see returns of 5% or less. Eventually, you will improve, and you’ll have more money to invest if you invest your profits, so you’ll see larger gains and you can set higher goals. At first, simply remember to focus on not losing money and know that some profit is better than nothing.
Don’t Think Trading is Easy!
A few minutes of research cannot possibly prepare anyone to become a forex trader. There’s a lot you need to know, so don’t make the mistake of opening a trading account too soon. Predicting market behavior isn’t easy, it takes a lot of knowledge to make good trading decisions. If trading were a quick way to get rich, everyone would be doing it. If you’ve already started and you’ve lost money, don’t give up. Just take a break from trading until you’re better prepared. Don’t think you’re going to become the best trader overnight just because someone you read an article that makes it sound easy.
Don’t Quit Your Job (Yet)
Forex trading inspires many people to quit their jobs. There are a lot of benefits to becoming a trader, including flexibility, not having a boss, being able to work from home or anywhere with an internet connection, and so on. Unfortunately, some people quit their job believing that forex trading will allow them to make enough to sustain their lifestyle. If you’re only starting out with a couple of hundred dollars or even a few thousand, you aren’t likely to make enough money to pay all your bills and take care of a family if you have one. Try out trading part-time for a while so that you can see firsthand how much money you’re going to make. Then you can decide if that amount meets your requirements. Don’t feel discouraged if you can’t afford to quit your job yet because this could be a longer-term goal.
Focus on Being the Best You Can Be
It isn’t about making the most money at first. The primary objective is to learn from your mistakes and to be the best trader you can possibly be. You don’t have to get the same results as someone you know so don’t beat yourself up over the little things! If you don’t understand something, research it. Keep a trading journal to log your mistakes. You won’t become the best trader out there with a little bit of practice, this is a long-term goal that takes a lot of time and hard work. If you aren’t willing to put in the effort, don’t become a trader. If you’re ready to make the commitment, then you should focus on short-term goals rather than only seeing the big picture.
The Bottom Line
Many traders walk away from trading for good because they come into the forex world with unrealistic expectations. This isn’t an easy way to get rich, it takes a lot of hard work and time. Starting with short-term goals and realistic expectations will make it easier to celebrate small victories. Remember that making something is the first goal, even if you don’t make much, you still worked for that profit and you should be proud of yourself. Don’t feel discouraged if you’re feeling more ambitious – eventually, you could make enough money to quit your job, become a well-known trader, or meet any other long-term goal you have set. Simply know that it might take more time to achieve those goals and that you’re off to the right start.