Triple Threat FX – The Straightforward Way to Make Money With Currency Trading

February 9th, 2010    Posted in Forex

Source: Triple Threat FX

First, it’s very important to understand that all speculative trading is risky, whether it is in stocks, currencies, commodities or anything more. Nobody earns money on each trade, and that includes the most successful pro traders. So there is a risk that your manager will make losses for you. However, it is true that their results are likely to be better than yours in the medium to long term, even if there are times when things do not go so well.

Second, be advised that for a standard currency exchange managed account the minimum investment can be high. This is because a trader is normally trading your account for you on a commission basis. Obviously, the more money you have in the account, the bigger the predicted returns and the more commission he can expect to make. You can see that it wouldn’t be worth his time to deal with an account balance of 2 thousand bucks.

However, there is another choice. In the case of the standard managed forex account, your money is held in a separate account that you can view and have access to. But there is an alternative way of investing in managed currency trading which is known as a pooled account. Here your money goes into a pool with other clients’ funds, to be traded all together. In this situation it does not matter how much your individual funds are and the company will usually accept small investments.

There is more of a risk with pooled accounts in that you can’t see what has happened. You’ve got to trust that the funds are being held safely and the results are correct. It is critical to check on the background of the company and particularly, whether or not they are members of any regulatory bodies that will defend you in the event of a failure or crash. There’s a real possibility of scams with unregulated managed currency trading, so do your due research.