Sufficient capital is one of the keys to trading forex successfully. However, most of beginning traders do not have the luxury of trading with huge account right from the beginning. Most of the new traders will look to build bigger account by profitable trading.
It is very likely, that starting trader will look to double, triple or quadruple his small trading account as soon as possible - ideally overnight. It also extremely likely that he will fail in his task, and lose money that he could have been spending more wisely.
For the best results, trade with professional ECN/STP broker with MT4. If you can't trade with profit. Automatically copy the traders that are already profitable.
To trade forex aggressively is not entirely bad approach from the beginner. You have very little to lose and so much more to gain. But it needs to be done wisely and it is still not the best option for under capitalised under experienced trader. Good news is, that you can profit even from small account. Not by quadrupling it as you would expect. You need to find investors. Managing small account is harder than managing big account. You just need to show the world that you can do it.
How to trade successfully on small trading account in forex in 5 easy steps.
Find a forex strategy, or develop one on your own. Test it back and fort. Learn to be comfortable in any trading situation. Learn to expect unexpected and be prepared for the worst. Calculate possible drawdown, the worst case scenario drawdown. Have bulletproofed statistics on profit. How much do you expect to win every month and how much your are risking to lose each month in a process. Your strategy needs to perform well in hisotrical data and you must have absolute confidence that you have tested it properly.
Find a forex broker with investors platform. Forget doubling your account every month. This strategy will backfire sooner or later. You need to prove yourself and find and find investors. Only way to do so, is to have live results. When you have profitable live results, investors will come knocking on your door. Consider this from the start and find a broker with build in investors platform (Darwinex for MT4), eToro if you wish not to use MT4.
Build results. Investors will look for two things. Profit and even more importantly drawdown. Never allow drawdown to reach predefined number. Most investors will consider strategy with over 20 percent drawdown as too risky. Do not go there. You minimal account size should considered when calculating drawdown. If you know that you can reach 40 percent drawdown in 1 K account, wait until you have 2 K. Building a results and history takes time. Patience is name of the game. Do not hurry things. It will take however long it takes. Focus on consistency and never break your trading discipline. Not really focusing on profits but on long time vision alone will help you tremendously with your forex trading.
First investors. Let's assume you just made 10 percent on your 1000 USD account – 100 USD. Hardly worth month of work. However, if you just made 10 percent for 100 000 USD of investors capital you just made 7000 - 8500 USD for your investors and 1500 – 3000 for you, while not risking more than 200 USD of your private account.
Reinvest. Repeat. Rejoice.
