Forex Trading - A Maze Of Misinformation
If you want to get into something that will totally confuse you
and send you to the poor house at the same time then try getting
into Forex trading which is the buying and selling of currency.
An associate of mine has this horror story to share. For the
sake of protecting his already fragile shattered ego because of
this horrible experience we'll call him Joe.
"Hi, my name is Joe. I wanted to get into Forex trading or the
buying and selling of currency. For example, buying Japanese Yen
at one price and selling it at another price to make a profit.
Sounds simple, but trust me, it is far from it.
For starters, if you know nothing about forex trading, you at
least want to get some kind of an education about it that won't
cost you anything. Therein lies the first problem. Try doing a
search engine lookup on "what is forex trading" or "forex
trading definition" and you'll find a zillion links to all these
places that will teach you about forex trading, for a fee. So in
other words before I can even learn about forex trading I have
to invest money just to find out what it is? If that doesn't
sound fishy to begin with.
Well, eventually I found enough of a definition of forex trading
to know what it was and what it involved. The next problem was
how to get into it. Do I go to an online broker? Which one? So I
did another Internet search. Let me tell you, there are more
places online that will be more than happy to take your business
so you can't possibly know which one to go to unless you know
someone who knows someone.
Then, to compound the problem even more you run into these
listings that talk about forex scams. Huh? I guess I shouldn't
have been surprised but how can you run a forex scam? Well, let
me clear that one up right now. A bogus company acts as a broker
for your money. You buy your currency at whatever price and then
what happens is the company essentially runs off with your money
and closes their site down, opening it up someplace else. You're
now out your investment. That's only one of many ways that
companies are scamming people getting into forex trading, but
I'm sure you get the idea.
Once you find a legitimate company there are all the complex
strategies you have to learn. There's looking for exit and
entrance signs. In other words certain indicators that
supposedly tell you when to buy the currency and when to sell.
This is, of course, all guess work as nobody can really predict
what a currency is going to sell for at any given time. You know
this is the case when you see web sites with the following
advertisement, "Trade forex with up to 80% accurate forecasts."
In other words 20% of the time I'm going to lose money. This is
what they admit to. You know it's never that good.
But here's the worst part of forex trading and the thing that
most people don't realize. The percentage that your purchase
goes up before you sell is so minuscule that the only way to
make any decent amount of money is to invest hundreds of
thousands of dollars. People who think they can invest $25 or
even $250 are dreaming if they think they will make anything
worth talking about. With that kind of investment we are talking
about pennies in profit.
Bottom line. After everything I learned, which took me weeks of
my time, I eventually ended up chucking the whole idea of forex
trading. That's my horror story. Weeks of my valuable time
wasted on something that I had no business getting into in the
first place, given the poor rate of return and the possibility
of being scammed.
So unless you have a lot of money to burn my suggestion is to
stay away from forex trading. I just wish I knew that before I
ever started.