The Pros and Cons of a Forex Trading Career
A career where you become your own boss, work when you like and make a good income all without leaving the house. Sounds good? Well, this is the dream of many online traders. Having ultimate flexibility given today’s job market is extremely appealing. But as you’ll see below there are drawbacks and there’s a lot to consider before making the jump.
Like stock trades online for day traders, the rewards can be great if everything goes well with your online forex trading. Here we look at the pros and cons of going pro and have a full-time forex trading career, below is a list of pros and cons for online traders.
1. Amazing flexibility
The market is open 24 hours a day 365 days of the year. So your opportunities to trade aren’t limited to office hours. This may fit in with your life way better than any job could. For those with kids or any other constraints on their time, this flexible working is very useful.
2. Easy to start
With a plethora of free training online, learning to trade is a fairly straightforward business and with so much historical data you can certainly try and mitigate risk. Most brokers offer demo accounts as well, so you can try your hand for free before you begin to risk your money.
3. Low costs
Due to high volume, brokers charge low fees and offer tight spreads meaning that more of your profit is yours. This is where you need to assess which broker is the one for you. You need to ensure that they’re regulated and that they offer great account options. Also, check how tight their spreads are and definitely give their trading platform a try if they offer a demo account. This will ensure that you’re comfortable using the platform and that you understand it before you start to stake your own money.
4. Cool factor
Having a forex trading career as your source of income is undoubtedly cool! Nothing says you kick ass more than being your own boss. Though it is tough work. It’s often frustrating and can cause anxiety when you encounter losses. Your own financial situation is going to be a big decider as to whether you can make it work for you.
Undoubtedly the biggest con is the risk. Your own money is on the line and you will suffer losses throughout your forex trading career. It’s the management of these losses which will more than likely define your success in this career.
As with risk forex trading isn’t exactly the most stable career option. Reasonably high levels of geopolitical instability could make the forex markets a wild ride in 2017 and beyond. Also as the market is still young and fairly free from regulation there’s a high chance that this will change in the future as governments find a way to place limitations on trading. Indeed the change of presidency will pose new challenges in the markets and may even be able to produce some profits if the markets are predicted well.
3. Low trading periods
Around Christmas and the new year, the banks are closed, and as they provide significant liquidity in the markets the withdrawal of their money can allow the market to stagnate. Low liquidity can also make for high volatility and most traders take time off over Christmas to avoid it.
4. Being out of your depth
There are lots and lots of pros in the markets, many of whom may have information that you aren’t aware of. This is where care has to be used as you never known who is in the market.
As you can see the forex market offers lots of opportunities to make a career out of it. If you’re prepared to put in the work in order to learn about the market and gather information then it may be perfect for you. But it does carry significant risk, and as this is all on you, management of the risk will be the indicator as to whether you succeed or fail.
But in a fraught jobs market with depressed wages and less and fewer opportunities available a career in online trading is becoming more and more an option to many, and while it is obviously an exciting and varied career it isn’t without its risks.