Forex firms are now resorting to schemes and prizes to get in newer clientele and these goodies are generally given out by the Introducing Brokers (IBs) or even the futures commission merchants (FCMs) at times. A common incentive is a monetary bonus with many firms offering $250 or more to open an account. Several firms take another route, by offering a discount on the tuition fee of their courses being offered on trading basics. A recent fashion is to give the winner of trading games, where trades are done from virtual accounts, cash awards and chances to trade real cash.
It harkens back to the days when banks offered toasters and televisions for opening a Certificate of Deposit. Has this been in the pipeline for forex retailers then? The firms might not realize this, in their scramble to get more clients with the help of seductive incentives, but the trading competitions is not in the games they hold but among the forex traders and themselves in reality.
Every morning, forex traders try to match their trading instincts with that of the market and hope to accomplish winning trades by the end of it. Yet, what would be the outcome of changing these daily wars into a series of contests formally? At the outset there shall be the phase of simulation where traders will get comfortable with their strategies and knacks so that they can use to them to win trades later.
A mini account will be used to trade in real money, although very little amounts, beyond this simulation phase. Finally, there would be a trading competition with big lots. At this stage, the adrenaline begins to flow as each pip might make you win or lose $10.00. This sum up for all account sizes. If a trading competition is to be closer to reality then it has to have the periods of trading mentioned above as well as tests at each level.
There can even be many awards for various kinds of excellence in these trading contests. What can be wrong in there being a prize for anyone who gets the highest average pip per winning trade? Another prize can be awarded to the contestant who gets the lowest average pips per losing trade.
Again, say if someone got wins of more than 10 pips that are more than 10 in a row then there can be a prize for that. Such a contest would reward consistency in trading. Some winners can also be given the chance to trade in proprietary capital and then some other winners can be given simple cash rewards.
But the forex trader need not wait for an FCM or IB to offer a contest. You can easily turn your daily trades into a trading game with incentives. The game kicks start the moment you state your trading aims and thereafter chase them wholeheartedly. As a forex trader, you have to get hold of the following goals, and this works irrespective of whether you have a real trading account, or a demo version or a mini one.
You can try to attain a 60% win-loss ratio in either 25 or 50 round turns, or you can try for a seven winning trade stretch, seven winning trades over 15 pip average profit, or even maybe three of 50 pip wins within a week. A losing stretch should not go more than three losses and the drawdown of any month should not go beyond 20%. With a risk factor of 2% per equity per trade, you must carry out 50 trades that generate profits.
Select four pairs of currencies from the financial press release that comes out at 8:30 a.m.EST and ensure profits from them within the next three days. Although trading contests continue to be viewed as marketing utilities they can provide ways to measure trading skills. Being consistent and disciplined is very important, and so you should constantly fine-tune your strategies so that you get better on these two points. Without benchmarks, forex traders will never know of how they are performing.
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