Why Trading Forex Beats Being a Farmer
In This Video:
00:54 The Challenges of Farming
01:57 Forex Gives you Complete Control
03:59 An Email about Trading Skills
I want to talk about why trading Forex beats being a farmer, so let’s get into that right now!
Hi Forex Traders, it’s Andrew Mitchem here, today is Friday the 12th of June and in today’s video and podcast, I want to explain to you the differences between what I used to do, which is being a dairy farmer, and what I have done for the last 12-years, which is being a Forex Trader or a currency trader.
And I want to explain why in my opinion, what I currently do now far outweighs being a dairy farmer, so let’s talk about that because I’ve got fairly good experience about both. Now, I was born on a dairy farm, I’ve been educated in agriculture, I moved to New Zealand 19-years ago to continue farming. I’ve owned a farm, I’ve sold a farm – so I’ve got a fairly good understanding of farming.
The Challenges of Farming
But the problem with farming, and dairy farming in particular, is that so many aspects of it are outside of your control.
- You don’t have any control over the weather, the climate.
- You don’t have any control over disease.
- You don’t have control over a lot of your costs such as fuels and fertilizers and feed costs.
- You don’t have control over legislation in terms of safety requirements and food hygiene requirements that come in.
Everything that adds to your cost and really does affect your business in so many ways and you have really little control over all of those things. Yet you have a massive amount of assets tied up, capital tied up within the animals or within the farm.
And a lot of people seem to think, for some reason that you don’t have much control over what you are doing when you’re a Forex trader. But actually I believe that that’s incorrect. I believe that you actually have a lot of control over what you’re doing as a trader and let me explain why.
Forex Gives you Complete Control
You see, when you’re trading Forex, you have control over what you trade – which currency pair you trade, when you trade; what time-frames you trade; which direction you trade; you can be a technical trader, a fundamental trader or a combination of both; you can control your risk that you take on a trade. You can close part of a trade, you can move stop losses, you can close all of your trades, you can do whatever you like.
Of course you can’t control the actual movements within the market but that’s where education and knowledge comes in and understanding price patterns and what’s happened previously in terms of support and resistance and how that’s likely to affect your trades going forward.
But when it actually comes to be able to manage your trades and place your trades, you actually have a huge amount of control – far more than you probably do within farming when major parts that affect your business are completely out of your control. And also don’t forget the actual barriers of entry – the cost of being a dairy farmer are enormous and involve huge amounts of debts for most people whereas the cost of entry into trading – a computer and Internet connection, if you want to go well with your trading – likely some form of education – and then, once you’re ready to go from demo to live, some form of assets in terms of account to trade on. But really, that’s quite low when you consider the barriers to entry for trading as opposed to farming.
So I hope that explains it – I’ve seen both sides of the equation – I’ve seen the physical aspect of being a farmer and I’ve seen the online version and what I’ve done for the last 12-years of being a trader. So to me they are two very different aspects there but I’m more than comfortable and happy with the option that I am currently doing because to me, it far outweighs any farming benefits.
So that’s the actual theme of the video and podcast!
An Email about Trading Skills
I also wanted to share with you – I’ve got an email here that was sent to me yesterday from a client, Chris, who took a trade on the British Pound/Australian Dollar (GBP/AUD) 4-hour chart. It was a trade he said that he took before unemployment figures were announced in Australia so he took it for a technical reason. And he had a trade on that hit a 150-pip profit for a 34-pip stop-loss, It gave him a 4.4 to 1 reward to risk and he said that the take-profit was hit within 40-minutes of actually placing the trade so with half a percent (0.50%) risk on that, that was a 2.2% account gain in 40-minutes on a technical trade that had the fundamentals following through but the technicals were already telling Chris what to do and in advance of the news coming out.
And secondly, fantastic news on a live webinar held for my clients last night. Gustav, a client of mine who’s doing extremely well – took two trades on the five-minute charts – so we’ve gone from Chris here with a 4-hour chart down to Gustav with a 5-minute chart. Just shows that the strategy works on all time-frames.
But Gustav took two trades while I was on the webinar live, and made four-percent (4%) gain on his account just on those two trades. And it happened while we were live on the webinar and we were looking at the trades and he said, I am putting the trade on now – here’s my stop, here’s my profit – I’ve closed a part of this trade and the other one’s hit profit.
Brilliant trading – just identified two nice pull backs on the Euro/British Pound (EUR/GBP), on the 5-minute chart. I was actually on the same pair, in the same direction on a 1-hour timeframe that I took live on the webinar. Gustav went down to 5-minute charts and took two trades. Four percent (4%) gain in a matter of minutes so just shows what can be done.
So hope you’ve enjoyed the video and podcast. If you have any questions you’d like me to answer in the future videos and podcasts, any subjects of my trading, how I can help you – just send me an email: [email protected].
Look forward to talking to you this time next week.
Have a fantastic weekend and a great trading week, next week.
Bye for now.