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How Much Money Can You Make Trading Forex?

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Happy Friday!

This week’s question comes from Martin, who asks:

How much money can I make per month trading Forex?

Admit it, this is one of the first questions you asked when you entered the Forex market.

There’s no shame in it. I certainly wanted to know how much I could make when I started with equities in 2002.

The thing is, it’s a slippery slope.

Curiosity is natural. While there’s no harm in asking questions, the answer you receive—and whether or not you dwell on it—can have serious consequences.

In today’s post we’re going to discuss how much is too much profit, the proper time horizon for measuring returns, and an alternative method that has served me well.

Ready to do this? Let’s go!

Forget What You’ve Been Told (or Sold)

Has someone ever tried to convince you to buy their trading system that promises 10% profit per month?

How about 20% or 30% every month?

If you have, feel free to a leave a comment below. I would love to hear from you.

In case you’re one of those traders and are still confused about the earning potential in the Forex market, forget what you’ve learned thus far.

There are no guarantees in this business, only possibilities and probabilities.

No matter how good you are, you won’t make 30%, 20% or even 10% profit every month.

Sure, you’ll have a great month now and then, but sustaining those types of gains is not realistic. In my opinion, the people using these kinds of profits as a selling mechanism give this business a bad name.

Sometimes in order to move forward, you have to forget what you think you know. This is one of those situations.

If you have dreams of living off of your $500 trading account, think again.

The business of trading is a marathon, not a sprint. It’s a slow incremental process that requires a ton of discipline to succeed, and you can’t have massive profits without the associated risks.

So when someone offers you a system that produces 30% profit every month, they are handing you a ticking time bomb.

This brings me to an extremely effective, but somewhat unconventional, way of thinking about earning potential.

Put the Trading Process Before Profits

Person focusing on the trading processIf you want to become a consistently profitable trader, you must focus on the process first. I can’t stress this enough.

No trader has ever become successful by focusing solely on how much money he or she can make each month.

In fact, many traders don’t even have such a goal.

I’m more concerned with how much money I might lose in a given month than how much I can make. I know that if I protect my capital and follow the process I’ve laid out for myself, profits will follow.

That’s the key here. A race car driver doesn’t hop into their car and focus on nothing but winning the race.

Sure, that’s the goal and it inevitably crosses their mind, but their focus is primarily on details like when to brake, how early or late to take each turn, and when to punch the accelerator.

They know that it’s the small things that make the difference. If they adhere to the process of good driving that they’ve practiced for years, the win is all but guaranteed.

Trading is no different. Focusing on making 50% profit per month won’t make you a dime. It will, however, put you out of business in a hurry.

Just like the race car driver, you should focus on the trading process.

Keep your bets small, wait for quality setups and don’t trade the news. These are a few of the steps of this process that you should focus on.

Do these things well consistently and the profits will find you.

If You Must Aim for a Monetary Goal...

I get it, striving to master a process isn’t appealing to a lot of people.

Personally, I enjoy it. But then I’ve always been a process-oriented person.

If you must set a monetary goal, here are a couple of ideas to consider:

Keep it conservative.

You aren’t going to make 30% profit every month. If you’re keeping your bets small, which you should, then your gains will also be relatively small.

But that’s a good thing. There’s nothing wrong with aiming for just 2% to 5% each month. In fact, I think that’s a good place to be.

This isn’t a goal you want to knock out of the park. If you’re aiming for 5% profit per month and you make 40% instead, chances are you over-traded or overleveraged your account, or both.

Neither of these are habits you want to feed.

Make it a monthly goal or higher.

The problem with weekly and daily goals is that you aren’t giving yourself enough time.

You may only get five to ten quality setups each month if trading the daily time frame. With just one to two setups each week, you can’t possibly measure a return in one day or even one week.

You could also set quarterly and yearly targets. Just remember that the process required to achieve those profits is far more important than the money itself.

See this post for more on goal setting.

In the Long Run

Long term thinking as a traderThe amount you can earn from Forex over the long run is nearly limitless. With approximately $5 trillion exchanged every day, entering and exiting the market with millions on the line isn’t even a blip on the radar.

I suspect that’s the problem right there. Everyone is in a hurry to get a piece of the $5 trillion pie.

Here’s the thing, though…

The market favors the disciplined. Those who have the patience to wait for quality setups and never take excessive risks get rewarded for their prudence.

Start treating your $100 account as if it were $100,000. Heck, write it as $1 million if you have to; whatever it takes to avoid the temptation to double your account every month.

After all, 2% to 5% of $100,000 is $2,000 to $5,000 of profit each month.

And with a $1 million account, it’s $20,000 to $50,000 per month.

Of course, those are just hypotheticals. You will always have good and bad months no matter how much experience you acquire.

Figures like these may seem unthinkable to some. But many of the multi-millionaire traders we read about started with far less.

Bill Lipschutz, one of the best currency traders of all time started with $12,000.

Ed Seykota began his trading career with just $5,000, and Randy McKay could only scrape together $2,000 to start trading.

All three grew their accounts into millions of dollars despite starting with a relatively small amount of capital.

If you want to separate yourself from the 90% (probably closer to 95% in my opinion) of traders who lose money consistently, you have to think differently.

Most Forex traders overtrade and overleverage their accounts in an attempt to make 30% profit or more every month.

So to be in the top 5% to 10% of traders, you have to do the opposite. You have to put more focus on how much money you could lose rather than how much you can make.

Remember, a trading edge is far more than just a strategy. Anyone can learn to trade price action or swing trade and utilize the various strategies of each. That’s nothing special.

An edge is the entire process from start to finish. It’s anything that separates you from the crowd.

So start thinking long-term. You can grow your account from where it is today into a fortune, but it’s going to take years, not weeks or even months.

That’s precisely what the likes of Bill Lipschutz, Ed Seykota and Randy McKay did to achieve greatness.

Final Words

Trading any market successfully is a long-term endeavor. It takes years, not months or weeks, to become consistently profitable.

Armed with that information, it becomes much easier to take things slowly. Keep bets small and focus on quality setups, rather than attempting to trade every day.

If someone claims their trading strategy or system earns 30% or 40% every month, run and don’t look back. While such profits are possible, they aren’t sustainable and will likely lead to a blown account.

I learned years ago that it’s far better to focus on the trading process. That includes things like risk management, having the patience to wait for quality setups and drawing accurate levels among other things.

As long as you master the process of trading well, the profits will follow. In other words, let the money you earn from Forex become the byproduct rather than making it your motive.

If you must aim for a specific monetary figure, make it a conservative one. Don’t make the mistake of shooting for 30% or 40% profit per month.

A goal somewhere between 5% to 15% per quarter is reasonable yet still quite attractive, especially for those with larger accounts.

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Your Turn: Ask Justin Anything

I’d love for this new weekly Q&A to be successful and provide an invaluable repository of answers to common Forex questions.

To do that, I need your help.

Here’s what you can do to get involved and have your question answered in next week’s post:

  1. Ask questions. Post them in the comments below or Tweet them to me @JustinBennettFX
  2. Help me answer questions. If I missed something or if you have something to add, don’t hesitate to leave a comment below.
  • Lakes says:

    I partially disagree with ”No matter how good you are, you won’t make 30%, 20% or even 10% profit every month”. It depends on your trading pattern and consistency. There are moths you’ll even 50-60% depending on market volatility. I agree partially cod if u are a scalper you’ll definitely lose

    • Justin Bennett says:

      I’m open to disagreements, but I’ve never come across a trader who made 10% or more profit EVERY month, and I’ve studied dozens of them.

      The key word there (and in the article) is “every” month.

      • Thomas says:

        I think daytraders can make 10% per month, don’t you think so? I suppose your post is about swing traders.

        • Justin Bennett says:

          It applies to every trader. I’ve made more than 10% in a single month, but it isn’t going to happen every month. That’s my point.

    • Jeor Mormont says:

      The point is, there is not fixed return in a month. There is no GUARANTEE that you can make 10%, 20% or 30% just like the promises of some people who are selling signals. This is on the assumption that you did not over-risk, meaning, you did not risked more than 10% of your capital on a single trade, this is on a presumption that your risk is only at least 2%.

  • Khaing Khant says:

    I have nothing to say.. It is too useful for me.. Thz u sir.

  • Frank says:

    This is Quite an information. Thank alot. My name is Franck and my question is, what is your take on binary options? Is it profitable? Can I make money out of binary options? If No, why?..
    Thank you.

    • Justin Bennett says:

      Hi Frank, I might write about this one. Personally, I dislike binary options. Too much fraudulent activity concerning brokers. Plus you’re adding a time horizon for each trade which must also be correct.

  • Donald says:

    What u are saying it is true bcuz since I have been in trading industry I have never make consistent profit buzzy over trading i read everything that u are posting i like to say thank

  • tahir says:

    sir great article i loved it.i resd ur every post i want to be a member but the price is quite high please do some favour for small traders like me

  • derrick says:

    that question of a newbie was well answered

    • Justin Bennett says:

      Appreciated, but I wouldn’t call this a “newbie” question. I know traders with several years of experience who are still making some of the mistakes I outlined above.

  • M.DHANABAL says:

    sir,i want$100 for trading inyour forexa/c

  • Albert Kuudening says:

    My account got blown last week as I was promised 80% to 100% profit by a robot,with GBPUSD.

    • Darius says:

      I do not get people how you believe about those big profits. So if you make this amouts of profit, then imaging how quickly would grow those who have millions. You have million. After months you have 2 millions. Then 4. then 8, etc. so after a year you would have about 500 millions 😀 in just one year 🙂

      And then thrilion and after year 500 trilions 😀

      • Ade says:

        Many of these prey on newbies who come to the forex market and do not know how difficult it really is to make money.

  • ONYEKACHI ALLEN NNADOZIE says:

    I HAVE NOTHING TO ADD OR ARGUE ABOUT BECAUSE ALL YOU SAID ARE FACTS.
    THANKS FOR THIS PRECIOUS ARTICLE.

    • Justin Bennett says:

      You’re welcome.

  • Okezie sylanus nkoro says:

    You are 100% correct. here is my own question, is it advisable to trade the martingale way? Trading it with the best setups that has the potential of bringing in 200pips while risking about 25pips.

    • Justin Bennett says:

      Thanks for the question. I’ll add it to the list.

      In the meantime, anything that uses martingale is a ticking time bomb. You’d be better off burning your money to stay warm during the winter.

  • RIN SAVANN says:

    Thanks you to signal for me

  • Ben Garner says:

    Justin I really appreciate all your advice thus far, right now I am just starting out, I’ve gotten my feet wet….but let me ask you….What do you think about NADEX?

    • Justin Bennett says:

      Hi Ben, pleased to hear you’re enjoying the content.

      See my response to Frank above. I’m not a fan of binaries.

  • Bert says:

    This is totally off the subject but I saw your course offered above and just saw an example yesterday on the USD/CHF as an example, People frequently say they can’t trade Pin bars because the can’t find enough of them. Maybe this will help some. Look for long double bars. A double bar is a pin bar formed over 2 periods rather than one. Starts at one price one day–moves a good distance–starts at that price the next period and goes back to the price it started the previous period. On Friday’s close look at a 12h and a 6h chart.
    Also people frequently wonder why pin bars are so profitable. “I THINK” it is because they are “frequently” a result of those in power
    running the stops to build up their capital. Think about it–where are the best pin bars–at support or resistance areas. Where do many traders place their stops–they try to hide them below/above resistance areas. The bigs know this–they run the price through the resistance area, knock out the stops, then move the price in the direction they intended in the first place.
    Interesting to see what happens here.

    • Chekwe says:

      You have said it all. This is an eye opener to me. Thanks a million times.

    • Vietduc says:

      i dont understand the ” double bar” part

  • Chucks says:

    You stated the obvious rules that govern fx market. But I have following observations;
    1. Trading news is at one’s discretion as against your directive. One can trade news successfully with good strategy and good broker. Trading news is very profitable when traded very well.
    2. “The cost of Justin’s course was minuscule compared to the return, to put it in traders terms my ROI (return on investment) as of today is 8,900% and that is not a joke. Thank you again Justin, you changed everything for me”

    That was a claim made by Ted H, one of your paid members. Though he didnt state the period he made the ROI but I doubt if he could make such return with 2% to 5% profit every month.

    • Justin Bennett says:

      This entire website is a collection of my opinions on various topics. When I say to avoid trading the news, it too is my opinion. If you’ve found a profitable way to trade the news, go for it.

      As for Ted’s comment, you’ll have to ask him; it’s his quote. But just like my remark above, those figures of 2% to 5% are my opinion. It doesn’t mean you’re wrong if you choose to go your own way.

      • Ibrahim Alexander says:

        Sir you confuse me. You suggest a higher timeframe, what to do if news comes and you are in trade?

  • Rickwin Marakim says:

    Thank you for the excellent advice and suggestions. Really appreciate it.

  • Wallingnuma says:

    Hi Justin
    Once again you nailed it. I am a member of your community and it cost me 40% of my trading account but it’s for life and I know by following your coaching it will be paid off just a matter of time. I have only been trading for about 3 months I was introduced by a family member who turns out to be a very aggressive trader but you only heard about his wins not loses. Anyway I was hooked and then I found Forex Factory where there was an article from you and after reading it I was a member within hours. I changed my broker to your preferred broker and was able to download the Metatrader4 platform and it’s just been great. Only in the last week or 2 have I started to make very small profits mainly because I have strict rules around protecting my capital. In fact so strict I have yet to reach any of my targets. Maybe I need to slacken off I don’t know but at least I can now see profits and I don’t CARE how big or small they are. Also after exploring the MT4 platform and Forex Factory I see a lot of SNAKE OIL.
    Thanks so much for all of your posts and I enjoy going on this site every day I reckon you must of cloned yourself because there is no way one person can do all what you do. Please keep up the good work and live forever.

  • Agung LA Fx says:

    I am agree. Trading is a process

  • ruben says:

    hola amigo .hace meses que leo tus informes diarios como semanales he aprendido no mucho pero lo hago con mucha paciencia . todavia lo hago en demo . soy argentino aca no hay medios confiables para depositar y tener el retorno . para aca tu estrategia nos cuesta muy caro aprovechamos tus informes gratis .ejecuto cuando se presenta esa oportunidad de tu estrtegia . me interesa aprender y estar preparado para cuando en mi pais se abra m,as el juego para el forex . muchas gracias . saludos . Ruben

  • Comfort Oby Nwosu says:

    I started trading forex October 2017. I have lost much money. I set out to make profit but lost so much. I need help.

    • Vik says:

      Reach out I could assist

    • Daniel says:

      Comfort, take it easy.Go for knowledge, go and read, go and do paper trade for few weeks to months, before you go live. Join forex groups. Ask more questions. Praclick, practice and practice more. Don’t be in haste to trade live until you understand how painful you can loose your hard earned dollars

  • Kevin says:

    Can anyone make a living trading the markets. Can you take trading as a fulltime engagement rather than a hobby or a part time endeavour?

  • Abraham Mustapha says:

    As a trader for 7 years who has lost money due to wrong expectations, the advice to keep my bets small, wait for quality setups and don’t trade the news is very important. Thanks Justin

  • Habib says:

    Thanks a lot. For last two month, I could not make any good setup in my treading. From your today’s article, I’v got some inspiration.

  • HilmiiShukrii says:

    I love your blogpost. I have a question. Between Stock Market and Forex Trading, which is better to invest in?

  • Yusuf Ahmad says:

    The post is very enlightening, I like that.
    Nothing to add.
    Thanks

  • surasak wichakham says:

    4063550585

  • Uzzal Barua says:

    I don’t wanna disgrace anyone here, but to be very honest, what Justin wrote is the ‘FACT’, Believe It Or Not. Everyday I get many emails or even calls from many, including Market Traders Institute, Nicola Delic and many more. In reality, they are busy selling their products that don’t actually work. Can anyone here tell us about any specific system that could ever earn 20%, 30% per month? It is unrealistic. Even if I am lucky to earn 30% in month, the next month I am not able to earn even 2%. Sometimes, I lose what I gained last month.
    Justin is the only Coach in this industry I have ever seen, who teaches you 2 most inevitable things: 1. The art of Trading, (how to trade on your own) and 2. Love your money, (minimizing losses will ultimately increase your account).

    Thanks to all.

  • Endy Michael says:

    Thanks for this post, Justin. Given the way you emphasize this Trading Process in many of your posts, could you expatiate it. For those of us who want to follow it, What is a Trading Process?

  • Georgi says:

    This is probably the first question I asked myself.
    This article was useful to me.

  • ConsistentLoser says:

    account blown few time over various system 😐 im a consistent loser 😐 i think i have spend more than 10k usd into system + account. broker and system seller are happy 😐

    • Roy says:

      I’m sorry to hear that. Look at all articles on this site. It just might turn your trading around.

    • Njabulo+Mchunu says:

      Sad to hear that

  • Uche says:

    Very instructive!
    I assimilated every bit of it.
    Thanks also for your daily trading signals.

  • carlos paredes says:

    un trader debe esperar solo un 6% de ganancias de promedio mensuales de su capital y si lo combinamos con intereses compuestos, estaríamos duplicando la cuenta en un año. (paciencia y poca ambición…. )

  • Sboniso says:

    Hi guys which forex broker do you recommend?

  • Haitham says:

    Haitham 0796550851

  • Ibrahim+Alexander says:

    Thanks alot Justin for your knowledge.
    I was thinking myself if its possible to loose 100% for even a week when you are dummy, how comes to be impossible to be profited 100% for a month when you become a pro? I’m a newbie, what I think is that the trade I loose, some one who trade the same trade but in opposite will profit, if not what is the secret behind trading?

  • TotoCaca says:

    Damn I must be a god then XD
    Yay every one is godawful but me.
    Sure as hell ain’t selling my method hehehe

  • Signe J. Petersen says:

    The first and most important broker selection factor one should consider is regulation.

  • Signe J. Petersen says:

    The excitement of binary options trade can disappear as soon as you learn what is expected of you. You have to learn trading strategies, decide what assets to trade on and which broker to use. It is a lot of work but when you start making money, you will forget about the struggle. If you decide to trade in Forex

  • Njabulo Mchunu says:

    Thank you Thank you Thank you, such divine albeit rare wisdom

  • jackieron says:

    I am a victim of a binary scam I was burned by a bogus broker recently it was difficult to get a withdrawal. I had to hire a recovery company to get my funds back. infojackie04atgmaildotcom

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