In this article, we will talk about how much forex day traders make a day. We will also discuss how to be a profitable trader as well.
The answer to this question isn’t simple. There are several factors that can affect how much a forex day trader makes. Some of these include their capital, their level of experience, and their ability to execute risk management strategies. This article will discuss these factors and the amount of money that a forex day trader can make.
How much can you expect to make with day trading?
The more experience you have the more money you can make with day trading. If you are a profitable trader you can make anywhere between 1% – 15% per month. Let’s do some calculations to see how much capital you need to make a full-time income with forex day trading.
Let’s say you have $1000 in your trading account. Then if you make 10% per month, that means you will be making $100 per month. Let’s say you want to make $4000/month with forex trading. You will need around $40,000 in capital to make this much money.
But the great thing about this is that if you do not take your profits out of your account, you can compound your growth by reinvesting your trading capital.
That said very highly experienced traders can even double their capital in a month. But if you are a beginner trader you will lose money but that’s alright. We will talk about this later on in this article.
There are other ways to make money with forex trading. One great way is to get a job as a forex trader but this is not why most people start trading forex. Most people start trading forex because they want financial independence and to be their own boss.
But getting to this point is not that easy and will take a lot of hard work. Getting a job as a forex trader can actually help you develop your trading skills and make you a better trader and eventually you can become an independent trader. This is something that you can consider as well.
Working a Job as a Forex Trader
You can also work for a trading firm or a hedge fund as a forex trader. They will give you a base salary and commissions based on your trading performance. The average salary of a forex trader is $100k/year. If you don’t have much experience with forex trading you will typically make less than $100k/year.
As you gain experience your employer will pay you more. You can also ask for a commission on the trades you make as a forex trader from your employer as well. Now let’s talk about where to get your trading capital.
Where to get capital to start Trading?
If you don’t have any capital to start forex trading you have three options. One option is to work a job and save money to fund your trading account. Another way is to ask a friend or an investor for some money. The second option is not recommended if you are a beginner.
You need to have a profitable trading strategy before borrowing money to trade. Another way is to work for a prop firm. This option is quite popular these days as well.
A prop firm will give you a funded trading account but you have to prove yourself first. A prop firm will usually have a trading challenge which can be hard for beginner traders. To get funded you need to pass this challenge.
To pass this challenge you have to have a good knowledge of forex trading. If you are interested you can go through our step-by-step guide for free to learn how to trade in the forex market.
Most Beginners will lose money
It is important to note that most beginner traders will lose money at first with trading. This is also called the 90-90-90 rule. It says that 90% of new traders lose 90% of their capital in the first 90 days of trading. You can read more about it here.
It is absolutely okay to lose money as a trader because even experienced traders lose money. The key however is to be profitable. That means that your winning traders have to be bigger than your losing traders. If you are a beginner, you have to treat the money you lose as education.
Little by little you can adjust and optimize your trading strategy to become profitable. But this will take time, expect at least 6 months to become consistently profitable if you put in the work. Some traders take years to become profitable.
If you are discouraged by this, think about this. Most people spend 4 years in college to get an average-paying job. If you are not even willing to spend at least 2 years learning and practicing trading you cannot expect to become a highly profitable trader.
Expert Traders Can Make A lot
There are expert forex traders that make more than a million dollars a year with forex trading. But getting to this level is not easy. Only a few traders make it to this level.
To get to this level you need to work smart and gain a lot of experience. And to make this amount you need to have millions of dollars in your trading account as well. There are some traders who have flipped a few thousand dollars to millions of dollars. This is extremely rare.
Also, to become a really good trader you must track every trade you take. That’s why you need a trading journal. Make sure to get our trading journal which is completely free. By tracking your trades you will be able to know which trading strategies are profitable and which trading strategies are not profitable. So make sure to track your trades.
Some expert traders also automate their trading with expert advisors/ trading robots. It is a very good skill to learn if want to eventually automate some of your trading strategies. To automate your trades you need to learn MQL5.
But remember, before you learn MQL5 we recommend you have at least an intermediate level of forex trading knowledge. Because your trading robot will do what you say, if you don’t have a profitable trading strategy, the trading robot will not be profitable.
Conclusion
As discussed in this article, there is a huge range in the amount of money a forex trader makes. Some forex traders lose money with trading and some traders make millions of dollars with trading. It all depends on your willingness to learn and how disciplined you are.
Forex trading is not an easy profession. If it was everyone would be doing it and making money in their own time. So always be patient with trading.
Spend a lot of time analyzing the markets and learning how to trade profitably. If you are interested in learning how to trade we recommend you check out our free step-by-step guide to trading in the forex market.
