FX Trading in Action - An Example of Making Money in Forex Trading

Here is an example of how you can make money with FX Trading while winning only 40% of your trades.
Lets setup a trading scenario...
Suppose that you decide the following:

1. You will trade Monday - Friday
2. You expect to loose 60% of your trades and win 40%
3. You are aiming for risk:reward ratio of 1.0 : 2.0 (that is, for ever $1 you risk you expect to make back $2)
4. You will be trading on a $300 micro account
5. You will risk no more than 2% on any given trade, or $6 at the outset.

With a micro account, risking $6 (or, 2%) of your account will enable you to place stop losses of 60 pips, which will help tip the odds of winning a trade in your favour. In addition, according to our risk:reward ratio, you will be aiming to make $12 for every $6 that you will risk.
Lets see how this currency trading example works out...
Out of 20 trading days in the month (because we will be trading Monday - Friday), you profit 40% of the time (so, 8 trading days). For the remaining 12 days, you are expecting to incur losses. This is how your profit/loss scenario would look for your entire trading month:

• PROFITS: $96
• LOSSES: $72
• NET GAIN: +$24
• ROI: +8%

On a $300 account, that $24 net gain equates to a 8% ROI over the entire month. Now, you may look at $24 and think that it is not a lot of money. That is, of course, true. However, look past the actual dollars and cents and realize what you have actually accomplished. A return of 8% in one month is a yearly ROI of 96% - that's pretty much equates to doubling your money every year. Compare this what your friendly local bank pays - a tiny 2-3% per year!
In the foreign exchange market, it is very realistic to expect 8% returns in any given month, even if you're losing 60% of the time!
Even if you just traded for one month each quarter, you would still realize an attractive 32% return every year.
Now that is something worth looking at! Look past the actual dollars and cents because a micro account is merely designed to help you become better. Once you can consistently get your desired returns every month, you can then upgrade to a standard and/or mini account and create massive returns on your capital.
It's all about perfecting your trading and then scaling up!
Case-in-point: become an outstanding Forex Trader first and foremost. Practice with demo accounts, trade real money on micro and/or mini accounts if you can do it and develop solid skills. You will then make a lot of money in the Forex Market.

Jay West writes about many subjects, including Business, Finance, Personal Development, Health & Fitness, Internet Business & Marketing and Making Money. He is a successful entrepreneur and has been trading currencies for several years.
visit http://www.fxtradingsecrets.com/ where he writes about his ideas and strategies to become successful at FX Trading.