Turn $50 to $1 Million in 3 Years Trading Forex Long-term
So now you know you can trade the daily timeframe in forex with as little as
$50, but what can you do in forex with only $50?
I'm going to show you how you can turn $50 to $1 Million in
3 years trading forex long-term using the daily timeframe. First, as examples, let me
show you a few graphs.
The first one shows the GBP/NZD trending at an average
of 23 pips per day for 2 months:
If you had bought the GBP/NZD towards the beginning of this trend and
sold the pair towards the end, that's a guaranteed average of 23 pips per day
(even if you had sold the pair late, it still would have averaged about 20 pips
Next, let me show you a graph of the EUR/USD trending at an
average of 10 pips per day for almost a year:
Note: These are not cherry-picked graphs. Some trends can
even average 25-50 pips per day for several months.
I just want to show you that a guaranteed average of 10 pips per day is very
feasible trading forex long-term with the daily timeframe. But what can you do with only 10 pips per
10 pips per day translates into an average of 200 pips per
month. If you are trading with 40% of your money with 50x leverage, then that
translates into a 40% average gain per month!
- $20 x 50 = 1,000 units
- 1 pip = $0.10
- 200 pips x $0.10 = $20
Gaining only $20 from 200 pips may not seem impressive, but
keep in mind that if you grow your account to $5,000 then you will use $2,000
as margin and potentially gain $2,000 in one month.
The following graph shows what happens to $50 if you can maintain only a 33%
growth rate per month – $50 to $1 Million in 3 years!
Trading Forex: Turn $50 to $1 Million in 3 Years - 33% Monthly Return Long-term Trading
There is a lot of information in the above graph, so I have
broken it down into each individual year so you can see what is happening.
year 1, $50 turns into about $1,100 with a consistent 33% growth rate:
That may not seem very impressive to turn $50 into $1,100,
but that's a 2,200% increase in one year!
Year 1 - Trading Forex: Turn $50 to $1 Million in 3 Years - 33% Monthly Return Long-term Trading
Then in year 2, that $1,100 turns
Year 2 - Trading Forex: Turn $50 to $1 Million in 3 Years - 33% Monthly Return Long-term Trading
Finally, in year 3 that $35,000 turns into about $1 Million
– $50 to $1 Million in 3 years!
Year 3 - Trading Forex: Turn $50 to $1 Million in 3 Years - 33% Monthly Return Long-term Trading
How to Maintain a 40% Growth Rate on a Long-term Trade
Now that I have shown you what is possible with only a 33% growth rate (turning $50 to $1 Million in 3 years), let me show you how to maintain a 40% growth rate on a long-term trade.
If we go back to the first month, you would have $20 used
margin, $30 unused margin, and approximately $20 in unrealized profit. Your
forex broker will generally consider unrealized profit as part of your
available margin, which means you will appear to have $50 available margin
again ($30 unused margin + $20 unrealized profit).
If you add 40% of your unrealized profit as an additional
trade, pyramid style, then you can maintain the ratio of 40% of your money
being in the trade.
Your new trade size is:
- $20 x 0.40 = $8
- $8 x 50 = 400 units
Thus, you would have a trade of 1,000 units that is about
200 pips profitable, and you just now added a trade of 400 units. With $20
unrealized profit your account value would be $70 and you have $28 used margin
out of $70 available margin.
Obviously, if you use a forex broker that only has standard
lots, then you may have to wait until you can safely add an additional 1,000
units to the trade (requiring another $20 margin). Technically, this is already possible because trading 2,000
units only requires $40 as margin. But if you have $70 available margin, you
are using almost 60% of your account value trading 2,000 units.
Of course, using more than 40% of your available margin will
obviously accelerate your monthly growth rate, but it can also cause you to get
a margin call if the trade goes against you for a few days before going in your
Alternatively, you can just use a broker like OANDA who lets
you trade with however many units you want.
Consistently Profitable Forex Traders
As I mentioned, using 40% of your money with 50x leverage is
the same trade size as using 100% of your money with 20x leverage. Many profitable
forex traders actually use even less than 20x leverage, because of the unsustainability of losses from high leverage.
profitable forex traders use less than 10x leverage, which is the same
as using only 20% of your money with 50:1 leverage.
It will take a lot longer to turn $50 to $1 Million if you
are only using 20% of your available margin (or use 10x leverage), but with
less leverage comes less risk. If you want to be successful long-term, then it
is important to understand the Top 3 Consistently Profitable Forex Trader
If you did decide to only use 20% of your account value with 50:1 leverage (equivalent to using 10x leverage), then in 3 years you could be making over $5,000 per month trading the daily timeframe from an initial deposit of $50.
Even that achievement is pretty amazing!