Making Forex A Safe Passive Income Source

But if you study forex trading and how the investment system works, you would know that there is a way to tame the beast, as they say.

 And if you can learn how to tame the forex beast while achieving double, triple or even quadruple the returns when compared to a bank time deposit, wouldn’t you be more interested to invest in forex?

 There are ways to make the risks that an investor takes in forex trading lower. There are methods and strategies that can lessen the risks associated with forex trading.

 Of course, there is the trading strategy that would be a major factor in determining, not only how profitable and effective the trades shall be. But more importantly, there is the money management side of the investment which can greatly control the risk involved.

 Part of money management is the degree of leverage that you, as an investor, are willing to use in your trading account. Remember, the higher the leverage that you use, the greater multiplier effect it shall have on you profits and losses. So, in order to reduce the risks, you should be willing to lower the leverage that you are using in your trading. But remember that it would also mean that your profits would equally be softened with a lower leverage. But don’t worry about that too much. There are other ways to increase profits.

 Then, there is the matter of lot exposure. The number of lots that you choose to expose in your trades will also affect the risks that you take for your entire trading account. Remember that it is not only the size of the lot that you expose for a single trading position that matters. But it is more of the totality of the effect of the sum of all the lot exposures that you make. The higher amount of total lot exposure you make in your trading account, the greater effect price movements shall have in your profits or losses.

 These two factors of money management can be controlled easily. In fact, they are the factors of forex trading that you can absolutely control. So, it is best for you as a forex investor to be strict in this aspect of your trading.

 As for the other aspect of trading which involves the strategy that you choose, that is another matter to be considered. But for forex to be truly a source of passive income, you may choose to utilize forex robots or EA’s in your trading so that the work of making decisions and monitoring the markets are taken away from you. Just be sure to choose your forex robots wisely by comprehensively testing them.

 It is really not that hard to find a forex robot that can easily give you at least 20% returns in a year. Now, that is certainly a lot better than the 4% loose change your bank is offering you for your money