What Makes A Successful Day Trader?
A successful day trader works with a strategy.
Success in terms of profit can differ vastly in the Forex world. A Forex trader and make 10.000$ a day, while another, using the same strategies makes 10.000$ a month. Therefore is not only about what strategies you use, however also about different factors like experience, execution, decision making, and more.
Having said this, a Forex strategy looks at two things;
The win rate
A day trader has a specific number of trades per day; let’s take a random number, say 15. The win rate is the number of profitable trades in the 15 trades. So if you win 10 out of 15, your winning rate is 66% which is achievable but keep following, and I will show you why almost 99% of day traders won’t achieve it.
Leverage
Leverage is the financial muscle traders borrow to acquire assets and increase their profit. Brokers provide leverage. So the type of broker you pick matters. Brokers can provide leverage of up to 50:1. Meaning if you have a $1000 capital, you can trade up to $50,000 with the same risk of $1000.
Not to get you too excited, the higher the leverage, the higher the profit, and so is the loss. Soleverage is a good tool, but master how it works before using it.
How Much Money Can Forex Day Traders Make a Day?
There are many factors to consider before answering this question. But if you look at the elements you need to be a successful day trader above, you can quickly get an answer. First, however, let’s assume you started day trading with a capital of $1000.
In your strategy, you place a maximum of 15 trades a day (too many), lose 5 and win 10. You are looking at a total of 60 pips per day.
As mentioned, you make roughly $20 a day. For a month, which is 20 days since you only trade Monday to Friday, it will be:
$20 x 20 days = $400 a month.
If you consider commissions and trading and withdrawing fees, you remain with roughly $330
In case you plan to start trading with an initial investment of $10000, you will make;
1% x 10000 = $100 risk per trade, using a lot size of 0.10 because the amount is bigger
0.1 x 60 = 6 but you make $60 because each pip with the lot size is $1
$60 x 20 days = $1200 adding up to $14,400 per year. However, if you are using a bigger lot size you willmake more.
On the other hand, a $100 account will make;
$100 with a lot size of 0.01 because it is a small account
0.01 x 60 = 0.6 which is $6 per day.
$6 x 20 = $120 per month
Not bad, right? However, remember that the forex is never a perfect market as these figures look. Getting 100% turnout every day is not typical, let alone simple. However, the aim is to keep losses minimal. You cannot eliminate them entirely.
The truth is that approximately1% of day traders become successful at the end of the year. This shouldn’t scare you because you are amongst them if you follow your strategy. How much time you invest in learning and understanding the market is critical for profitable trading.
Something fundamental not mentioned by many is trading psychology. Psychology in trading is something people should be willing even to pay to acquire. The ability to keep emotions out of trading is vital.
What Do I Need To Be a Successful Day Trader?
Risk Involved
Pioneer traders insist that your risk should be 1% of your capital in one trade. Therefore, if you have $1000 in your trading account, you should risk only $10 at a profit ratio of 1.5%.
It sounds so little to make such an amount, yes. However, discipline is critical. How much forex traders make in a day depends on their invested money. It is worth noting that forex is not a get-rich-quick scheme.
Knowledge Investment
How knowledgeable are you about the subject? As you know, forex is not gambling nor a game of luck. It takes time and money to master the skill. Therefore, apart from the money you can put in forex, invest in knowledge about how the market works. That’s why you are advised to trade on a demo account before putting in real money.
Discipline
Congratulations on putting money and time into forex trading. However, let me remind you that how much money you can make trading forex a day can also be the same as how much money you can lose. It all depends on the level of your discipline to your strategy.
If your strategy says to use 1% of the capital and execute 15 trades per day, you will be killing yourself to go against it. If you make your daily target, be disciplined to stop. You have probably heard people who made thousands of dollars in a day and lost it all on the same day.
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Frequently Asked Questions About How Much Money Can You Make Forex Trading
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Exactly how much can I make trading Forex in a day?
In your strategy, you place a maximum of 15 trades a day (too many), lose 5 and win 10. You are looking at a total of 60 pips per day.
As mentioned, you make roughly $20 a day. For a month, which is 20 days since you only trade Monday to Friday, it will be:
$20 x 20 days = $400 a month.
If you consider commissions and trading and withdrawing fees, you remain with roughly $330
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Is it worth to trade Forex in my day to day?
Pioneer traders insist that your risk should be 1% of your capital in one trade. Therefore, if you have $1000 in your trading account, you should risk only $10 at a profit ratio of 1.5%.
It sounds so little to make such an amount, yes. However, discipline is critical. How much forex traders make in a day depends on their invested money. It is worth noting that forex is not a get-rich-quick scheme.
