How would you start forex trading with $100?
The most searched question on the internet today about forex is probably
” Can I start trading with just $100? “. So if you, like many other traders, are hunting for this answer then here it is – YES! You definitely can! Because, unlike any other financial market, forex is a market for everyone. So next time don’t shy away from trading just because you can invest $100 in your trading career.
Many people feel interested in trading forex because of its golden opportunity. Forex is a leveraged market where your initial investment can grow by 20/30 times and sometimes even a whooping 500 times when you take them. However, even if you have access to leverage of 1:500, trading with $100 in the forex market has its own set of challenges and restrictions.
In Sureshot FX the recommended account balance for trading starts from $100. So, you’re at the place where you would genuinely learn how to start forex trading with just $100, what’re the opportunities lies for you, and what you can’t do with that $100.
So let’s start with what you can do first!
What you can do with $100 in forex trading?
Here, we’ve listed the positive things that you can do for $100
- SIDE HUSTLE THAT WILL IMPROVE YOUR LIFE: Many people realize that $100 doesn’t buy much these days, but if you want to trade the forex market, $100 can get you started and could even generate a new source of income from home. If you develop and implement a successful trading plan, then your first $100 forex account could ultimately change your life for the better.
- PRACTICING MONEY MANAGEMENT: You can learn money management starting with $100. Imagine a situation where you are left with only $100 to live with, would you be gambling away the money, or would try to make the best use of the money you have. You would certainly choose to make the best use of it. So, why can’t such mindsets be applied to the field of forex trading? Things are really the same in forex. You’ll figure out how to make the most of what you have.
- GETTING ACQUAINTED WITH REAL TRADING PLATFORM: Real trading is different from a demo account, in a real account you’re risking the money putting down to the broker’s desk, where the broker is reselling the position to your right from the interbank market with real money. You can use your $100 forex account to make the transition from demo trading to real trading more smooth. There are many people who start trading in real accounts with a large amount of money right after completing demo trading. This is never a wiser decision in transition.
- THE RABBIT & THE TURTLE: Well we know that slow and steady wins the race. Well, in forex, we can say Small & Steady wins the race! It all comes down to how you are handling that $100 account. If you are consistent in making profits then your day of financial freedom is not far!
What you can’t do with $100 in forex trading?
- Reality check 1: If you are planning to quit your work and become a full-time trader with just $100 then STOP RIGHT THERE. Let’s face the truth here- it’s a good idea to start trading with that money, but you won’t be able to make a living off of it initially. But here’s the bright side-not immediately but eventually you will be able to make a living off Forex.
- Reality check 2: You can not make your $100 to rise up to $10,000 or $1,00,000 within a month. We know you’ll be coming across different forex service providers ( or scammers or fake gurus!!) influencing you saying that it’s possible with some unrealistic binary equations. We would like to confirm and assure you that, It will not happen.
- Reality check 3: The $100 you deposit into a Forex trading account should be 100% excess money. That means you can afford the entire amount without it affecting your day-to-day life. You can still pay all your bills, provide for your family, etc.
How would you start forex trading with $100?
To start, you need to have a trading account first. The process of opening a forex trading account is no longer time-consuming; it can now be done in minutes or hours using the device in your hand, and payments can now be made online.
Following the guidelines below, you can trade forex for $100.
- Money management: The initial approach of starting to trade with $100 is to learn and must have money management. The money management method is that you will trade within the 3% of this money in the market exposure. This apparently means that you can only trade in micro-lots; minimum position sizing of $1000. In case you hold trade with an EU or UK-based broker, only then you can use maximum leverage of 1:30. With a 3.33 percent margin, you won’t be able to trade under risk management restrictions with an EU broker, since you’ll require at least $33 to trade 1 micro-lot. Anyway, brokers from Australia, South Africa, and other off-shore jurisdictions still offer leverage up to 1:500. In those cases, a micro lot would need just a $2 commitment from the trader, which would keep the position within allowable risk management limitations.
- Risk-reward ratios: Risk and reward are two terms where the risk refers to the Stop Loss(SL) and reward refers to the Take-Profit(TP). For every 1 pip risking at the Stop Loss(SL), you must target to gain 3 pip in profit. Using your allowable money management, which limits you to 1 micro-lot position, means that for every $2 used in the stop loss, you should be prepared to target $6. This translates to a TP of at least 60 pips and an SL of at least 20 pips.This requires extra care while choosing your trades. Only join trades with a high probability of success, and target your setups with well-defined support and resistance criteria. Some chart patterns, like the flag and pennant, have defined profit targets, and the pattern boundaries can also help in defining the stop loss.
- Avoid the News Spikes: News trades are extremely volatile, particularly in the first few minutes after a news release. Your trades will be quickly stopped by the spikes and whipsaws. With such a small amount of money, you should avoid news trades at any and all costs.
Finally, trading with a $100 trading account can be both exciting and insightful. A modest $100 trading account could be the beginning of a new source of home-based income for you, just as it has been for a growing number of people. Earning a living depends upon your dedication, persistence, confidence, and expertise.