Can You Make Money With A Small Forex Account?
In this video:
00:26 – Making money as a small time forex trader
01:22 – Yes you can make money – but once you know how to trade
02:15 – Client from Germany making great returns
03:55 – How do I make money though?
05:15 – An example of a trading service
06:12 – Reinvest the income into your own trading account
06:54 – Change your mindset
Can you really make money as a trader with a small Forex account? Let’s talk about that and more right now.
Hey traders, Andrew Mitchem here at The Forex Trading Coach with video and podcast number 362.
Making money as a small time forex trader
Now I want to get away from the coronavirus just for a bit because everybody’s talking about it and wanted to get outside away from the office and away from the charts and just talk about the practicalities of making money as a small time Forex trader. Can you do it and how do you do it? It’s a subject that I get asked quite a lot and I made a video on this exact same subject about five or six years ago and I put a comment on the YouTube page saying look, I’ll make an update because I think it’s important to refresh these kinds of things because so many people are looking at trading, but they’re not wanting to put too much into their account to start with or they can’t afford to put too much into account to start with. So how do you go about being profitable, making money as a small time trader with a tiny account?
Yes you can make money – but once you know how to trade
And the answer is, the good thing is yes, you can make money. But like I’ve said to people in the past, look right now your account size doesn’t really matter. If you’re looking at any form of training, education course, whatever it might be, don’t look at the value of that course and go, my account, $1,000, your course is $2,000, how on earth can I afford it? Don’t look at it like that. The important thing for you right now is to learn how to trade and that’s the really important aspect. You’ve got to understand the market, you’ve got to learn how you can trade yourself.
And I think that’s really important and it’s quite underestimated. It’s something that people look over and they kind of value everything according to what they can afford right now today.
Client from Germany making great returns
Now I’ve got a client from Germany who joined me about six months ago. He is incredibly profitable on our forum site. He shows me his trades, but he has got quite a small account. It’s under 1000 euros. Now he trades with nano lots, so not even micro lots but nano lots and he’s constantly making really good money. He’s making like sort of three euros, five euros, six euros. So when you look at his monetary value, for some people they go, “Oh, that’s not very much.” But when you look at what he’s making per trade, and he’s making lots of trades, because this particular guy I’m thinking of likes the shorter timeframe charts. He might be making between five and 10 trades a day and he posts on our forum site.
Yet when you add all those up, he might be making of two, three, four, 5% a day on his account. Now the important thing is also, because he came to me recently and said, where do I go from here? So my answer is quite simple. You’ve done the hard yards right. You’ve done the hard work up front. You’ve taken your time. You’ve not worried about your monetary return. You’ve attended webinars, you’ve understood the strategy, you’ve asked questions, you’re on our forum site, you’re constantly posting trades. You’re not embarrassed that you’re making like five euros on a trade. Someone else might be making 500 or 5,000, it doesn’t matter. The fact is that he’s still controlling his risk on all of his trades and he’s still making a good percentage gain.
How do I make money though?
So bring that back to the situation Andrew, that’s all well and good, but I need to live, I need to eat, I need to feed my family.
So my advice to this guy was you obviously narrowed a stage that you can trade. So can you increase your account size? Can you go from 1,000 euros to maybe 5,000 or 10,000. Now for some people, that answer will be “Yes, easily, of course I can do that.” But other people will be, “No way, because 1,000 is a lot of money and that’s all I can put into my account.” If you’re in that situation and you can’t just go adding more funds to your account, especially now in the coronavirus situation where people are losing jobs, et cetera, and income’s a little bit more shaky, easy answer is once you’ve proven yourself to be a good trader and once you’ve proven that you’ve got good returns, consistent trades, low drawdowns, low risk, all the things that we teach, once you’ve got to that stage, jump onto some of the the signal services, onto the Myfxbook where you can verify your trades and and make money out of your own trading, get people copying you. There’s a lot of services out there that charge somewhere between 50, $100 a month.
An example of a trading service
Now let’s say this guy, and I’m just going to pick a figure because I’ve not looked at his latest account, but let’s say he’s making 50% in a year, let’s say, but with a drawdown of let’s say 5%. Just picking some figures. How many people around the world, especially in the current situation where people on the stock markets and shares and retirement funds have just absolutely tanked, lost billions and billions of dollars the markets have, how many people around the world do you think would be willing to pay $100 a month to be able to make 50% in a year with a 5% drawdown? Thousands, the answer is thousands.
If you can prove it, it doesn’t matter whether you’re on a nano account with 1,000 euros right now. The fact is, if you can prove that you can make 50% return in a year with tiny drawdown, consistent trading, you’ll have a following of thousands and thousands of people.
Reinvest the income into your own trading account
So what do you do with that? Well, and don’t forget, this is a monthly resubscription as well. If you were any good, you would just keep getting paid. So what you do with that? Well, you can then reinvest that back into your own trading account, can’t you? And rather than 1,000 euros, you can have 10,000 euros, 50,000 euros and now all of a sudden you’re making still your same 50% on your 50,000 euro account and you’re making yourself 25,000 euros just off your 50,000 euro account that you’ve increased its value from doing nothing different because all you’ve done is got people to copy your signals. So you see where the answer comes here.
Change your mindset
Too many people have the mindset of small account, I’m never going to compete with the banks and the big institutions because I’m just a small retail Forex trader. Forget that, don’t think that mindset. Think of quality trading, high quality, great consistent returns, small risk. Think of it that way and yes, a small time Forex trader with a small account can make money, can do well, can go on to great, great things.
Hope you enjoy the video and the update. Hope you enjoy the scenery. I’m outside here at home, house down below there. Beautiful Tasman Sea even though it’s a cloudy day able to see Tasman Sea up behind us here. Just nice to get outside on the lockdown situations, but wherever you are in the world, hope you’re keeping safe and well. Any help that you need trading, any questions, anything you need