Trading Discussion How do forex traders make money?

[ManiMoon]

In the foreign exchange market, traders and speculators both work together. They buy and sell various currencies based on whether they think that the said currency will gain value or lose value. No matter whether traders sustained gains or losses, forex brokers make money on fees and commissions basis.

If anyone is missing please add.

 

[cashisking149]

Brokers also make money on spreads

 

[btaliat]

Trading involves buyers and sellers. The loss of either of the two is automatically gain of the other.

 

[Mandy96]

As a forex trader, you have to think like a gambler and what I meant by that is to always be ready to take risks so there won’t have to be you losing out, I am not saying forex is gamble but if you ask me, I think I see so much similarities between the two, you just have be firstly patient because it is more like predicting virtual games, you will need to study the graph, make sure you understand how the rate is flowing currently before you place your prediction, these are just tips though, the true fact about it is that, there is never a sure strategy to earn from it regularly.

 

[Victorial]

Are you asking about the way forex brokers make their money or the way the traders do? For brokers, they are always going to benefit no matter the outcome of the trader's trades. Lose or gain, is a win for the brokers. But a trader must know the game very well to know how to prevent losses. Understanding charts using candlesticks seems the best option for me. More importantly, learning how to manage risks while trading is important. Still, I have friends who don't trade with a stop loss and they are making it big. I am stingy with stop loss am dit affects my trades

 

[tetramorium]

The objective of trading currencies is to exchange one currency for another in the expectation of earning profits through the difference in exchange rates. Forex traders earn money by speculating on the price of currencies and buying the pair if they believe that the value of base currency will appreciate over time relative to the quoted currency, and they are likely to sell currency pair if they think base currency will depreciate.