Forex and crypto are huge at the moment, with more and more people seeing themselves as the new Warren Buffett, but how much money you can make can vary massively, whether it be because of a killer strategy or a bit of plain old luck.
In this article, we’ll be exploring how much money can be made from forex trading and crypto, telling you the key differences and what things you should know about each if you want to be the most successful.
So, which one can make you the most money?
Generally, forex will be more profitable as the market is bigger and there are more opportunities to make money. However, that doesn’t mean that crypto can’t be profitable, as it’s possible to make a lot of money from trading cryptos if you know what you’re doing. The key difference is that with forex, you’re more likely to find consistent profits, whereas, with crypto, gains can be more sporadic.
What things should you know about forex trading?
The foreign exchange market (forex) is the biggest in the world, with a daily turnover of around $5 trillion. This massive amount of liquidity means that there are always opportunities to make money, whether it be from short-term price movements or long-term trends.
However, forex also comes with its own risks, which need to be considered before trading. For example, leverage can significantly increase your profits, but it can also lead to significant losses if the market moves against you. Similarly, currencies can be very volatile, which means that stop-losses are essential in order to protect your capital.
How can you be a successful forex trader?
There’s no one-size-fits-all answer to this question as different people will have different strategies. However, there are some general things that you can do to increase your chances of success:
1. Get as much information as possible
There are lots of free resources available online which can help you to understand the basics. You might also want to consider taking a course or joining a trading community where you can learn from more experienced traders. There are people who can share lots of resources, but your best bet is to read the Q&As on the various trading platforms and just take in as many tips and tricks as you can.
2. Develop a strategy (including an exit one)
It’s also essential to develop a trading strategy before you start placing trades. This should include things like when you’ll enter and exit trades, what types of orders you’ll use, and how much risk you’re willing to take on. Once again, there are lots of resources available online which can help you to develop a profitable and winning forex trading strategy.
3. Use risk management
Risk management is one of the most important things to consider when trading forex. This includes things like setting stop losses and taking profits at predetermined levels. It’s also important to only trade with money that you can afford to lose and never over-leverage your account. This can put unnecessary pressure on you, increasing the likelihood of you making silly mistakes.
What things should you know about crypto?
Cryptocurrencies have only been around for a few years, but they’ve already made a significant impact on the financial world. The most well-known cryptocurrency is Bitcoin, but thousands of different coins and tokens are now available, with new ones being created all the time.
Investing in cryptocurrencies can be very profitable, but it’s also risky. Prices can be highly volatile, and there’s always the possibility of losing all of your money if you invest in a coin that turns out to be worthless. There are many tips and tricks out there, and following them is the best way to be on a path to success.
How can you be a successful crypto trader?
Just like forex trading, there’s no one-size-fits-all answer to this question. That being said, we’ve got some tips here that can help you maximize your profits and get you the best returns.
1. Educate yourself about the market
Before you start trading cryptocurrencies, it’s essential to educate yourself about how the market works. This includes things like understanding what drives prices and how different coins are traded on exchanges. Following notable people on social media can be really useful as you’ll be able to get some real industry insight and know what things may be happening in the near future.
2. Know when to sell
You need to know when to sell, as crypto can be a hugely volatile market. If you aren’t feeling super comfortable with how a certain coin is performing, sell and recoup as much of your investment as you can. You can use this money to reinvest in a coin that you feel better about that may be able to give you better returns.
3. Only invest what you can afford
A rookie error that many amateur traders make when they begin trading digital coins is over-investing and then not being able not to have complete control over their portfolio. If you want to ease yourself into the crypto world, it’d be best to trade conservatively at first and then gradually increase your portfolio once you have a better feeling for the kind of trades you like to make.