If you are a financial advisor or RIA, have any of your clients or prospects asked you about the foreign exchange market, and how to go about finding the top talent in trading?
Or are you a trader looking for insight on how to be among the best?
The foreign exchange market, or “forex” is the market of trading one country’s currency for another.
Forex is the largest market in the world, with approximately $5 trillion in trading volume each day. By contrast, the daily volume of the New York Stock Exchange during much of 2015 was approximately $22 billion.
In the United States, the forex market is regulated by the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA).
According to Forex Space, a content portal for forex traders, these five factors (see infographic) separate the top traders from the also-rans:
1. Education. “The best traders know that every trade is a learning experience.”
2. Trading System. The most effective traders “have the discipline to follow their trading system.” Having a system to follow is the critical first step, of course.
3. Price Behavior. The top traders “know that price action has the last word.”
4. Money Management. The consummate traders “avoid the risk of ruin.” Forex is not for everyone: leveraged traders can lose more than their initial deposit.
5. Trading Psychology. The savviest traders know that “every single trade has two possible outcomes, not just the winning side.”