Forex Trader Casey Stubbs came to his profession via the U.S. Army. While the route might be unorthodox for an investment expert, the founder of Winners Edge Trading attributes his time in the service for giving him the discipline and self-control needed for success in trading.
Through years of studying, practicing, making mistakes and perseverance during difficult times, he's honed his Forex trading skills and is anxious to share what he's learned with others anxious to jump into the market.
We recently caught up with Stubbs to learn more about getting started in the Forex trading.
What is Forex trading?
In short, Forex Trading is buying and selling different currencies. It is the idea of investing in certain countries' currencies that you expect to gain in value by selling your own currency for that. In other words, I may sell some United States Dollars for some Euros if I believe that the Euro is going to gain in value. This is done through an online broker.
What are the advantages of getting involved in the Forex trading market?
There are tons of advantages to trading Forex. To name a few:
- It has more liquidity than any other market.
- It can be traded 24 hours a day
- It allows you to use an exceptional amount of leverage in your trading.
- There are only a few currency pairs that you need to follow (rather than thousands of stocks).
- The Forex market has a lot of volatility (moves a lot) so there is a lot of profit potential in it every day.
- You can trade Forex with a relatively small account.
- There is no commissions in trading Forex.
What type of research should you do before trading Forex? Books to read? Websites to visit, etc.?
You should do a good bit of research before investing real money in Forex. Forex trading is very risky and can cost traders a lot of money if they are not educated. I would suggest that prospective traders always do three things before investing real money. The first is to browse all of the great resources on the internet (like my site, www.winnersedgetrading.com) and build a foundation of knowledge about Forex trading. The second thing is creating a trading plan that includes how they are going to manage their account and the strategy they are going to use to trade the Forex market. The third thing is that every trader should trade on a demo account (fake money) before investing live money in the market.
What are some basic principles that are important to understand before jumping in to Forex trading?
The principles that are MOST important would be understanding how to read charts, knowing how to manage your risk, and being extremely disciplined.
What are some rookie mistakes a trader in this market could make?
The No. 1 mistake that rookie traders make is risking way too much. In Forex, there is massive profit potential because of the leverage, and many new traders try to take advantage of that by risking way too much of their account. It takes time to understand that Forex is an investment tool like any other market, and not a get-rich-quick scheme.
How do you create a trading plan?
The best way to create a trading plan is to use a template like the one we offer at Winner's Edge. The template will help you form your trading plan by asking you what your goals are, what your mindset will be, what your understanding level is, what your experience is, what kind of personality you have, etc. Once you have all of this written down, you can begin to formulate a specific plan that aligns with your lifestyle, goals, and personality.
What advice do you have regarding day trading?
My advice for day trading is that you need a lot of experience to do it. Day trading is very tricky because the market is constantly knocking people out of their trades with losses on the smaller time frames. It makes day trading very difficult and I wouldn't recommend it to everyone.
Where are the best places to look for the latest news and updates on currency markets?
How should your personality type affect how you trade?
Your personality has a lot to do with how you ought to trade. For people who are laid back and don't want to be constantly involved with their trades, they should be longer-term traders. People who are not tech savvy will also have trouble being interactive in their trades, so they would better fit a long-term or swing trader. People who struggle with patience might want to study shorter time frames. Your personality will also likely determine your risk tolerance. Some people are risk takers and some are not. This will greatly affect how much you decide to risk in your trading.
What are good strategies for long-term success in Forex trading?
There are a lot of things you can do to help you realize success over the long term, but the most important is to become an expert at money management. If a trader can consistently manage their account with expertise, they will have a great shot at being profitable over the long term.