How to make money on the Forex market?

In order to make money on the Forex market you have to buy low

and sell high, quite simple. Let’s have a look at the example:

How much money can you theoretically make by trading currencies?

Let’s assume that you have 1,000 US dollars on your trading account.

The current exchange rate of Euro versus the US dollar

is 1.25. In other words, for 1 euro

you get one dollar and 25 cents. You forecast

that during the day Euro would rise versus the US dollar.

Based on this forecast you buy 800 Euros

for your 1,000 dollars. Your forecast is correct!

Euro rises from 1.25 to 1.26 dollars.

Being in profit you decide to close the trade and exchange

800 Euros back to 1,008 dollars. In effect,

your profit from this trade is 8 dollars. Not that much, right?

You raise a fair question:
Would it be possible to increase profits

In order to maximize your profit potential you can use leverage.

Leverage is a loan Tickmill provides you

to trade Forex. The size of the loan can differ but Tickmill provides you with up to

500 times more funds than your initial capital,

which also increases your profit potential 500 times.

Great, right?, Still, please remember...

Increased leverage means not only more profit potential

but also more risks! Managing your risks is very important!

Let’s have a look at an example how to use leverage of

one to five hundred (1:500). You have the same 1,000 dollars on your account

and you estimate that Euro will rise versus the US dollar

therefore you decide to take the biggest possible loan from your broker 499,000 dollars.

Now, with the exchange rate of 1.25

you exchange all your 500,000 dollars to 400,000 euros.

At the moment when exchange rate rises to 1.26

you exchange the 400,000 euros back to 504,000 dollars.

As a result, you now have 5,000 dollars on your account

after returning the loan to your broker. So your net profit is 4 000 dollars.

An incredible result after just one day of trading!

In this example we have looked at the scenario when your forecast

turns out to be correct. But what would have happened if instead of rising

Euro had fallen against the US dollar? In this case

your trade would be open until your losses equal your initial deposit,

which is 1,000 dollars. At this point your trade will be

automatically closed and the broker takes back the loan. Consequently,

a case when you can lose broker’s loan is almost impossible.

Taking everything into account, you now have seen how leverage can increase your profits,

if you make right decisions. At the same time, leverage can also work against you

if you make wrong estimations and don’t limit your losses.

Let me tell you, why I trust Tickmill: Tickmill likes to see the clients succeed in trading

Your funds are safe and segregated

Tickmill’s low Forex spreads (or the difference between buy and sell price) increase your profitability

You can test your trading skills on global markets with a small initial deposit of $100

You can use leverage of up to 1:500 (one to five hundred)

Tickmill allows all trading strategies including scalping,

news trading, arbitrage and executes trades in extremely short time.

This is why Tickmill is highly respected in Forex community

Visit our website www.tickmill.com to find out more!