How much can you make trading forex?

Forex - how much can you earn?

As far as exchange rates change every day or every few days, on Forex these changes happen in real time - again the issue of scale. Changes in bureaux de change are counted in pennies, and changes in Forex rates are counted in the so-called pips. One pip is depending on the given currency pair and its second or fourth decimal place.

For example: The EUR / USD has changed from 1.1345 to 1.1375 or 30 pips. Course 1.1375 means that to buy 1 euro you have to pay 1.1375 dollars. One pip means at this currency pair one ten thousandth of a dollar.

1 pip EUR / USD as we see this change of rate by 0.0001 - such changes are happening on the agenda. Sometimes the 30 pips stroke takes less than a minute. So if we predict that such a jump will happen and buy the euro earlier, then it will be worthwhile at the time we have it, that is, we will earn.

Well, how much will we earn?

And once again scrolling the issue of scale again. Forex gives us the ability to spin much more money than we actually have. Just say that turning 10 000 euro is not uncommon, even though we actually have $ 300 for example. Having converted the above, we see that 30 pips at 10,000 euros is equivalent to $ 30 (Forex gains are usually in dollars).

So we made $ 30 in less than a minute.

Keep in mind that the amount of profit you receive is linked to the risk you are incurring. The higher the risk, the higher the potential profit. As soon as you see the risk, it is an inherent part of everything we do in our lives, but nowhere can it be so accurately calculated as in the financial markets.

Having complete information, we decide ourselves whether we want to reduce the risk or increase it. Such comfort is often not in our everyday life.

In practice on Forex ...

In practice on the Forex market, earning a profit of up to 20% of your monthly deposit is not uncommon. This is a pretty cool profit, but not extraordinary. Depending on the risk we are able to take such effects are possible even a week, even three days with the risk that in this case will be bound to gambling.

The real situation on Forex

Suppose in point 1 we have sold a pair of EUR / USD currency. We actually opened the so-called "short" position for 1 EUR / USD flight (sounds awfully professional, but in fact it means that we clicked on brokerage platform 3 times.

The position closes the same day in point 2. On this price movement we made $ 140. Since it was Friday, we are spending the weekend to spend our honestly earned money on Forex. We only return to Forex on Monday and open this position "long" (we buy EUR / USD pair) in point 3.

This position is also finalized on the same day in point 4 earning $ 126 on it. In summary, we traded on Forex two days and earned $ 266.