How to Trade in Forex if You Are a Busy Person

Riya KapoorJanuary 24, 2022

2 minutes read

If you are too busy to follow the news and monitor the charts all day, it is possible to participate in Forex trading in an easier and less time consuming way. Social trading allows you to connect with experienced traders, see their performance statistics, discuss their trading ideas, learn from their mistakes and copy their successful strategies. In essence, you make professionals work for you.

Choose a Platform

Even if you are new to Forex, there are beginner friendly platforms like Octafx (10 millions plus users) that offer you an interesting opportunity – to follow the best traders and copy their transactions.

Follow Top traders

Discover traders you want to follow and add to your watch list. View their past performance stats, read status updates on their strategies, analyze results and communicate with them For trade Forex.

Copy their trades

If you are satisfied with the results and trading style, you can copy their trades with one click of a button.

Learn and Profit

Now you can sit back and watch how experienced traders do the work for you. Your task is to carefully analyze their results and learn as much as possible from their Forex trades. The ultimate goal of social trading is to build a portfolio of the best traders. You must have traders with different risk appetite and various currency

Leverage

A good example of leverage at work is when an investor borrows money to invest in a stock. Let’s say, the price of ACME’s stock is trading at $100 and you have $10,000, without leverage; the maximum number of shares you can buy is 100. If the company’s stock rises to $200 and you decide to exit, your maximum profit will be $10,000.

When leverage works, it is very useful to traders and investors. When it fails, the losses can exceed the initial capital of the investor leading to negative balances in your forex trading account. In the example above, if the stock fell to zero, the investor would first suffer a personal loss of $10,000. They would then need $10,000 more to pay back to the bank.

Pip

Is a standardized unit of change in the price of a trading instrument. Initially, when only 4-digit pricing was available, it was the smallest unit of price change. With the introduction of more accurate 5-digit pricing, 1 pip is still calculated by the 4th digit (0.0001). The smallest unit is now referred as to point (0.00001). In 5-digit pricing 1 pip is equal to 10 points. Example: When the price for EUR/USD currency pair changes from 1.11634 to 1.11645, it means the price has changed in 1.1 pips or 11 points. For USD/JPY currency pair, which has 3-digit pricing, a change from 123.857 to 123.864 means that the price has grown in 0.7 pips or 7 points.a dollar, whereas when the currency pair includes the yen, a pip is 1/100 of a yen because the yen is closer in value to 1/100 of other major currencies.

Spread

In Forex trading, brokers quote the bid and ask price for the currency pairs. The bid is the price that a trader can sell the base currency while the ask is the price they can buy the base currency. Spread refers to the difference between the two prices. Besides, this is how the “no commission” brokers- those who do not charge a separate fee on traders’ transaction- make their money. The spread is measured in pips. Most currency pairs- the base currency and quote currency- have a pip value equal to 0.0001. For instance, take the following quote; EUR/USD = 1.1051/1.1053 the spread is 0.0002, which equates to 2 pips.