Can I expect to make some good (any) profit at the beginning of my way?

Trading Discussion
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If you don’t have much money, making a ‘good’ amount of profit can take a while, and might be a challenge (considering that you’re just starting). Having too little capital is virtually the easiest way to lose all your money in the beginning, as your margins are very small. The best thing to do right now is to practice trading. I know this is what everyone says to beginners but for now it’s best to practice trading as that is what matters the most. Meanwhile, you could try and gather some capital to increase your potential profits, if you are comfortable with that idea.

I hope this helped!

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Search Youtube for a simple trading strategy and trade it in a demo account. This will answer your question for you.

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When you begin a climb and someone gives you basic advise how to do it, is it possible to climb on high, 90 degrees mountain?

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lower your expectations, start on demo, and choose a broker for your demo account which is the same one where you’ll want to trade later (so you won’t have to get used to using another different one at the same time as risking real money)

be aware that only a tiny minority of people (if anyone at all) makes “good profit” in the early stages

the early stages are for gaining experience, not for making money

it took almost of us several years before we were making “good profit” steadily (and that’s just the minority of us who ever reached that stage at all)

don’t be in a hurry

(if you are in a hurry, for whatever reasons, then it’s probably not the right way for you to try to make income)

choose a properly regulated broker (preferably regulated by FCA in the UK or by ASIC in Australia), not one regulated in the Seychelles or Belize or Cyprus or Vanuatu or somewhere with “soft regulation” where the rules and enforcement are designed to protect the brokers rather than the customers - and NEVER an unregulated broker - this is probably the single most important thing to know

good luck!

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:clap::clap::clap: I feel this was a really great straightforward answer.

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Hi @Amelia91

There seems to be a perception among experienced and inexperienced traders alike that everyone loses at the outset.

That is, of course, utter nonsense!

Ultimately your profitability relies on one thing: your understanding of the game. Allow me to give you a quick introduction to what I call the three pillars of profit.

There are three important things beginners and veterans alike need in order to turn a profit on the currency markets:

  1. Education
  2. A proven edge
  3. Access to capital

Education
I came to currency trading via the poker tables so I already knew how to manage risk and grow a bankroll. All I needed to do was figure out how to get an edge in the markets. At the poker tables I play tight-aggressive. Much to my surprise, the tight-aggressive style also seems to be the optimal strategy in the markets.

I’ll write a more detailed explanation of how poker styles can relate to your approach to the market in another post but for now I’ll just give you an example of two different poker styles that can be applied to the market.

Loose-aggressive
An example of a loose-aggressive style in the markets would be scalping perhaps. It’s possible to make some big profits taking lots of small trades but with the costs involved you’ve got to be on point or you’re going to get carved up by the spread and / or various other fees.

Tight-aggressive
An example of tight-aggressive style in the markets would be trading support and resistance perhaps from clearly defined zones. You’re not going to be trading a lot but when you do make a move, it’s a high-probability move and comes with a positive EV thanks to a carefully calculated win rate balanced against a suitable risk to reward ratio. The advantage of taking less trades with bigger payoffs is lower costs of course.

My point is, it’s no good familiarising yourself with your trading platform, learning a few chart patterns or copying some half-baked strategy and then diving straight into the markets. That’s why 90% of would-be traders fail. More importantly, you need to understand things like what really moves markets and risk management. A good place to start learning such stuff is the School of Pipsology.

A Proven Edge
A lot of people would have you believe that it is difficult to get an edge in the markets. Again, it’s trash talk from people who don’t understand how the game really works, the nature of risk or the principles of good money management.

Your edge comes down to accurately estimating the win rate of your chosen strategy and carefully balancing that win rate with a suitable reward to risk ratio. If you do this correctly your strategy will be profitable over the long-term.

Profitable strategies, believe it or not, are commonplace. I shared one of my own profitable strategies here on Babypips just yesterday and, sure enough, just a few hours later there was a winning trade on GBP/USD. You can find that strategy here:

London’s Ping Pong Pivot

Capital
The last important consideration is the amount of capital you have to work with, especially for beginners. If you are starting out with a few hundred pounds, dollars or euros, you are not going to really feel any profit you might make. You’ll make ten percent in a day and feel like you just lost. Twenty pounds, dollars or euros doesn’t go far these days! The reality is you’ll probably get bored long before your account grows to anything significant.

I’m going to start a new thread here on Babypips next week where I try to 100x a small account. I’ll probably fail but I will be posting a link to myfxbook just to prove it’s all legit, especially in the event that I actually achieve it! (I am currently in the process of writing a book about how to grow a small account fast so this challenge will be my testimony to the strategies I’m going to outline in that book.)

So, to be clear, if you don’t have a whole lot of money to throw at trading to start with you have two choices:

  1. Try to grow a small account fast.
  2. Try to win a prop firm challenge and get access to more capital.

The choice is yours, the safer play is trying to get funded with a prop firm of course.

In Summary
When it comes to trading there are no shortcuts to success, there is no secret strategy that will just start printing money for you. If you want to play this game and win, you’ve got to lay the solid foundations I have outlined in this post.

I hope this helps Amelia and good luck on your trading journey!

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As much as I’d like to encourage you, the honest answer is no. :confused: Starting out with forex would mean months and months of no “good profit” (which could change depending on your standards. :sweat_smile: ) cause that’s when you try to gain the knowledge you need to become profitable. :open_mouth: Having more realistic expectations and preparing your mindset for a challenging learning journey would be a great start to get to the good profit you want. :blush:

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Hey there! Thanks for your advice! I’m actually already practicing my trading skills in the “School of Pipsology” which is pretty awesome so far! But I have a question - if I gather more capital, does that mean I’ll make more profit? But what about the possibility of loss? Wouldn’t that increase too? Just wondering if you have any thoughts on that. Thanks again for your help!

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I just started studying here too! What do you think, do you recommend it? Or do you think YouTube might be an easier way to learn? Let me know.

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That’s a great example and you’re totally right about it!

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Thanks for the trading tips! starting on a demo account and choosing a broker for my demo that I’ll be trading with later is smart. I’ll be patient and choose a properly regulated broker.

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Thanks for your honesty about trading. It’s a bit disappointing to hear that making good profit in the beginning is unlikely, but I’m determined to learn and start strong. Thanks for your advice!

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I haven’t used the study programme here at babypips but I continue to find excellent tips on Youtube. Perhaps a problem there is that all these things are isolated strategies or tips or chart patterns and they are not related to each other and put in context as they come from different traders who we know little about.

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Yes, if you have more capital your risk factor does increase, as for example, 5% of $100 would be $5 and 5% of 1000 would be $50. However, that means profits also increase and are “easier” to earn, as a small percentage of your capital would therefore be worth more. Keep in mind, the higher the reward, the higher the risk (this is pretty much inevitable). That isn’t necessarily a bad thing, you just need to find your own balance between too much risk and not enough reward.

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Hi Amelia, while it is possible to make some nice profits (percentage wise) when starting out it is best to focus on building up your skill set and start trading in a demo or a small account size like a cent account.

Why? because as starting out you are bound to make mistakes and in the process to find what works for you. In that process you are bound to take losses as losses are inevitable. Not to mention aside from strategy wise, you have to work on the mental aspect. By starting on a demo or small account size you will be minimizing your cost of learning and once you gained enough experience and a working strategy you can then start to increase you account size and starts to gain profits which outweighs the cost of learning.

On the other hand if you start big for instance a $10.000 dollar account and you make a mistake and blow that account and blown more let say five more times of $10.000 trading capital, by the time you achieved profitable status, your learning cost would have reach $50.000. And if you start again with a $10.000 account that’s 500% to recover your cost of learning.

So i do hope my answer helps :smiley:

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I think they should give him the ‘Best Comment of the Forum’ award for this!

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I think there is no that kind of reward, but thank you for your opinion :slight_smile:

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As a beginner in trading, focusing on profits can discourage critical thinking and lead to impulsive decisions. Instead,

  1. Prioritize learning: Focus on trading strategies and risk management.
  2. Develop a trading plan: Outline clear objectives and risk tolerance.
  3. Emphasize risk management: Protect capital using techniques like stop-loss orders and diversification
  4. Cultivate discipline and patience: Stick to your trading plan and avoid impulsive decisions.
  5. Evaluate performance: Regularly assess and analyze trades for improvement.
  6. Adopt a long-term perspective: Aim for consistent growth and improvement rather than quick profits.
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Thanks for the great advice on trading strategies, risk management, and performance evaluation. I’ll definitely use these tips going forward.

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no ,you will not make any money from it at first ,at the middle of it unless you figure out what to do,normally that would take years before you knew it.

oh ,theres one exception ,you will make money at first ,that’s when you quit your job and put in your life saving ,and lose it all, and swear that forex is a scam ,just like the others.