Of course, the answer
depends on how much is your current income or the desired
amount of income you wish to obtain from forex trading
before you wish to quit the rat race and be a professional
trader, either part time or full time.
But there are many traders
who are quietly making 5 figure incomes monthly trading from
the comfort of their homes, and some of these are part time
traders.
So before you embark into
forex trading as a part time trader, here are some
guidelines you ought to consider: 1. Your devotion of time -
how much time are you going to devote to trading forex?
Contrary to popular opinion, you do not need to be glued to
your trading monitor to watch the prices of forex or
currency pairs all the time. The larger part of your time is
spent on finding those trading setups based on your trading
system and the execution is fast, and you can also pre-set
your stops and profits or give instructions to your broker.
In fact, it is the learning process
that will take time. So budget sufficient time to learn how to
trade, and that time allocation is actually required before you even
place a live trade.
2. Your allocation of capital -
again, if you trade the mini forex the amount of capital is not
large. Contrary to popular opinion, you can start a mini forex
account with around $500 and can start to trade. With a mini forex
account you can leverage off the system and be profitable.
3. Your Risk Profile and Trading
Discipline - you need to consider your risk profile. Are you
aggressive in trading, so that you will prefer day trading the forex
and thereby assume more risks? Or are you happy enough swing trading
the forex over a few days? This will determine the methodology and
trading system you will want to follow.
4. Advancing as a Forex Trader - to
advance further as a forex trader, you will need to constantly
improve your trading skills and see increase profits in your
trading. Good traders always keep a trading log and review whatever
trades they have executed and consider the outcomes. In this way,
they learn from their errors and know whether they have obediently
followed their trading strategies and had kept and maintain
discipline in their trading.
In making the transition into a forex
trader, the learning process is the most important. Many forex
traders have muddled along the way by a self learning process
without guidance, with the end result that while they may be
profitable, they are not consistently profitable. Many of them are
seeking ways to unlearn some of their bad trading habits. You can
avoid such a situation by understanding your own risk profile, and
seeking out a professional trader who can become your mentor and to
pass on his trading skills to you.
by Peter Lim
