Can you make money in forex trading in Canada?

Last Updated: 29-Nov-2022

Short Answer

Yes, you can make money in Forex Trading given some conditions. You must trade actively, plan and manage risk and set optimum leverage.

Detailed Answer

Forex Trading

Foreign exchange trading is the process of forecasting the price movements of currency pairs and trading them based on the market trends. One can trade in almost all the currencies used in the world and 24/7. The major advantage of Forex trading is that the market is highly liquid as trading in this market is done in nooks and corners of the world. Similarly, the commission charged for Forex trading is comparatively lower than a normal trading account.

Can you make money by Forex trading in Canada?

One can make money if he/she is an active trader. Commissions and buy/sell costs in the Forex market are mostly nil, hence you can actively take advantage of the price movements without having to pay much of the transaction costs. The rate of returns in a Forex market is low as it is in the money market. Hence, one has to actively buy and sell to make considerable profits.

A trader who has a sorted risk management strategy can make money. One needs to fix stop loss on your accounts, not more than 1%. Example, if you trade $5,000, you must not lose more than $50 in one trade.

A trader who sets optimum leverage and doesn’t risk high leverage can make money. For example, your leverage is 30:1 and you have $10,000 with you. You can take positions for up to $300,000. Since price movements are less in Forex markets, the more volume you trade, the more money you make.

Making money in Forex trading in Canada

In order to make a considerable amount of money in Forex trading, you must know the fundamentals of the Forex market, you must be able to spend time in active trading, you must be ready to take risks and you must put your strategies to test in demo account first.

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Categories: Investment
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