Earn money from forex trading’ can be defined as the process of gaining or making profit from foreign exchange market trading. Many individuals earn money from forex trading. The amount of money people earn in foreign exchange trading varies from individual to individual. Some earn less while others earn much higher than others. There are many factors that determine how much one can earn in forex trading. The following factors will be considered in this article:
Government policy: government policy refers to those decisions of the government that affect the economic and general well-being of citizens of a particular country. Government policy could be favorable or unfavorable. It is favorable when it increases the economy and raise people’s standard of living. Government policy is said to be unfavorable when it reduces the country’s economy and decrease the people’s standard of living. When government policy is favorable, foreign exchange market trader can predict the economy with less difficulty compared to when government policy is less favorable. Traders tend to earn money from forex trading with less difficulty when the government policy is favorable.
Rate of inflation: inflation is a process where large volume of money is in circulation or inflation is a condition whereby large amount of money is after little quantity of goods. Rate of inflation affect to a great extent how one earn money from forex trading. If a forex trader buy currency from a country when they are in state of inflation, the trader will make more profit if he sells the currency when the rate of inflation have reduced. Inflation in a particular country leads to devaluation of the country’s currency, which is decreasing the purchasing power of the currency.
Speculating abilities of an individual: because the economy is not static but in a continuous change, the foreign exchange market trade’s ability to predict the economy in the nearest future will increase the rate he earns money from forex trading. Speculating the economy is easier when there is favorable government policy.
The amount of money one invested: the rate at which a trader earns money from foreign exchange market trading is proportional to the amount of money he or she invested. If a trader invest more andpurchase currency when it is cheaper, he or she is likely to earn more money from selling the currency when the value appreciates
The amount of time one invests: the more time the trader invests in forex trading is proportional to the profit he makes. Therefore, if a trader invests more time in forex trading, he or she will earn more money.
These are not the only factors important to the discussion and they are also not the final determinant of how much you can make as a trader but they are important contributory factors since they influence the profitability of forex generally. But in the final analysis, how motivated, skilled and determine one is, will have the strongest say about how much one can make or lose.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.