Getting Started!

Hey folks:

I’m new to forex, but have been trading stocks and options for about 12 years. I’m currently building my knowledge level and kitty. How much kitty would you recommend that I start with? Thanks for your help.

there is no right or wrong answer, it all depends on how much you are comfortable trading with, and how much you can afford to lose. For some it’s $100, for others it’s $10,000

Almost 99% of newbies used to lose their initial investment . But that helps them to learn about money management and planning risk. Hence I suggest you to start with a micro account initially. Keep a goal in mind to increase the initial investment to a certain level before adding further money.

use just a couple of hundred bucks
Or just enough to make it annoying when you loose but not enough to hurt!
But get a feel for which ever platform you are going to try on DEMO first!

Nothing more annoying than Buying rather than selling.

As your account grows add some more funds,

For me personally though, a few hundred didn’t work…
I just threw it away like I was on demo…
A few thousand made me think twice about pressing the buy/sell.

If you’ve already been trading for 10+ years I’d imagine that you already have the basics down pat. All that you’d be missing is the specifics that relate directly to Forex.

It’s my belief that having too small a bank roll to start with is one of the TOP reasons that FX traders fail.

I also don’t think that demoing is the answer, I know most will disagree but trust me. The game changes significantly when real money is on the line. Not just psychologically, but the cut throat realities of the forex market come into play.

$10k. Minimum.

Just an opinion and good luck to you sir.

Learn your strategy on a demo account.
As soon as you are comfortable with your strategy, take a 1/5th of what you want to “start” with and put it on a live account.
If after 3 months or so you are consistently profitable in your trades, move up to your full amount.

What should your full amount be? There’s no right answer that we can give you because it depends on your available funds and what your goals are. So as was stated, just trade in micro amounts with a couple hundred bucks until you have developed your forex strategy to profitability. Then revisit how much you should use to bank roll your endeavor.

you have a lot of experience.
what made you switch? or are you just trying something ‘new’?

Hi,

I’ve been trading for 5+ years and my advice is around $1,000 of risk capital that you can afford to lose. Consider it a liability rather than an asset to begin with. This amount trading $1,000 micro contracts gives you plenty of room to move on your risk while also taking advantage of different opportunities in the market. It is also large enough to build into a sizeable portfolio if you are good enough.

Sean.

Whatever you do, do not invest more than you are willing to lose. Forex is a very liquid and largely unpredictable market and the fact you are in profit today doesn’t guarantee continued profits.

You got a lot of good asnwers so I just want to wish you a good luck :wink:

I still invest in stocks and options, but want to continue growing my knowledge and income generation capability. On monday of this week, i bought 300 shares of btu, then sold the $23 strike price covered calls for 1 month. I estimate that my profit will be $450.00, which will give me an ROI of 7% for 1 month.

Good luck on trading and as regards the kitty, seeing that you are a newbie, you may want to start with a small deposit rather than a big one - at least until you get the hang of things. And you can also opt for the demo

Thanks for all of the information guys. I almost pulled my first forex trade last night, but discovered that it takes three days for my broker to move money over to the forex broker. I’m looking to define my method for trading forex. Does any one have a good post to review? Thanks for all of your help. If you nice folks have any questions about stocks and options, than I will try and answer any questions you might have. We all need to make a living, and not work for the man!

Thanks for the offer and anytime I have a query on stocks, will post it in the forum. I did invest in stocks a while back, blew out my account - moved to forex and made it all back. Not saying it is easy but if you take the time, effort to learn about the market and do dry runs with the demo, you’ll find that it’s worth it.

I love the stock market, but I really don’t trade it. I use the profits that I make from covered calls to buy dividend stocks, so that I keep account income growing. I use several diffent methods to invest in stocks, and that whats I want to learn with forex, except shorter turn around. Shareing of knowledge is the only way that we grow as investors.

Ahh, yes the shorter turn around does happen a lot in this market and one way to go about it would be to start scalping for pips. But this is not advisable especially if you are new…so take the time to learn the ropes and once you have the experience, you can start scalping for pips on the 5 min charts…