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What Type Of FX Trader Are You?

By: Kayla Kayla.   
Date Added : August 4, 2011 Views : 469

Many people are investing in currency trade. Some want to make quick cash while others are long term investors who are patient in making more money from the FX. For that reason, there are different types of traders, such as scalpers and position traders. In essence, the scalpers are becoming quite popular in the FX. They place trades that have a short time span not exceeding five minutes. This means a scalper can make profits from a number of trades within hours. This factor attracts a lot of people who want to taste the benefits of the FX but without the long hours or days waiting for it to materialize.

There are many opportunities for scalpers in the FX. These trades range from 2 to 5 minutes and if the trader is able to make the right predictions and analysis, the trades will result in a good overall profit at the end of the day. There are many people who depend on the FX as a source of daily revenue because they have mastered it through the years. Scalpers do not engage in trades that will take the day and part of the night. This means they do not have to keep watching or studying the market hoping for good profits. However, being in the FX as a scalper is risky business. This is because the short duration heats things up and the number of scalpers on the same trade is always alarming. This affects the profits substantially.

Position traders are also common in the FX. Their trees take a longer time to grow. A position trader is a good option for those who are patient and want a long-term investment. However, the amount in trades is also bigger and this means being ready for anything as far as loses are concerned. These traders analyze the market extensively to find strategies and clues that will guide them in the FX. Before choosing to be a scalper or any other type of trader, a person should know the kind of trades he or she wants to be involved in. This determines the duration of the trades because if a currency does not have worthwhile returns, it would be a waste of time and money especially when it results to losses.

Analyzing the market also determines whether a person will be actively involved or wants to have an automatic assistant. This means getting the FX software. Since scalpers do not engage in 24-hour trades, getting a program that aids in day and night trade may not be appropriate. Research helps in getting information and ideas about the type of trade a person wants to be in. Position traders need to understand the gravity of the losses they might incur if they do not predict correctly or even the amount of profits they can make by taking trades that take a certain number of days. On the other hand, the individuals will also learn about other types of traders in the FX.

Kayla Dame is the author of this article on Forex. Find more information on Forex Trading here.

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