FREQUENTLY ASKED QUESTIONS
In the last few weeks, we've received dozens of questions, and found many to be similar in nature. So to save you the trouble of sending in your question and waiting for a response, we created this FAQ page with our own summarized set of questions taken from the dozens we've received so far. The odds are pretty good you'll see your question (or some variation of it) on this page. But if not, send your question to us at:
and we'll do our best to get back to you within 24 hours.
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Question: I have absolutely zero experience trading anything (stocks, bonds, commodities, currencies, etc.). Will your book really give me all the information I need to start trading currencies successfully from Day One?
Answer: Absolutely! I wrote this entire book with the idea that the typical reader would have no experience in the field of foreign currencies, and would in effect be starting from Square One. I teach you the basics behind foreign currency trading, the Rules of Money Management, show you how to create your own Trading Plan, and even give you a half dozen or so Trading Systems that have worked well for me and others over the years. Using nothing more than what you find in my book, you can start trading profitably the day after you read it.
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Question: I've heard that trading foreign currencies is one of the riskiest forms of investment there is. Am I putting my family or my assets at risk by trading them?
Answer: While there is no doubt that trading foreign currencies carries some degree of risk (as do all other forms of investment) in my book I teach you ways to minimize that risk while at the same time maximizing your ability to earn huge profits.
Plus, virtually all brokers are set up so that in the event you begin to lose money, the most you can lose is the amount you have in your trading account. There is never any worry about being "margin called" and forced to put more money in your account to cover losses. Once you begin to approach zero dollars in your account, your broker will automatically close out any open trades to prevent any further losses.
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Question: I work a normal 8-5 job, and have little free time other than a few hours in the evening before I go to bed. Can I still make money trading foreign currencies given these limitations?
Answer: Yes. The foreign currency market is not really a "market" in the sense that there is only one or two locations you can go to trade currencies (as opposed to something like the New York Stock Exchange, located in Manhattan). It exists online, through a series of connected bank computers.
What this means to you is that as long as one of the member banks is open for business, you can trade foreign currencies. This translates into a "market" that opens at 5 p.m. eastern time on Sundays and closes at 5 p.m. eastern time on Fridays. That gives you 5-1/2 days of round-the-clock trading opportunities. So if you only have a few hours at night to trade, that is normally more than you will need to start making money by trading foreign currencies.
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Question: I read your sample chapter, and all of this sounds too good to be true. Why haven't I heard more about trading currencies on the financial new channels?
Answer: That's a good question, and I really don't know the answer to it. When you think of how much money has been burned up in the latest stock market crash (and some of the related frauds that are just now coming to light) you'd think they would be all over an investment vehicle that can give the average investor such huge returns.
But you need to understand that the big brokerage houses have always been aimed at the sales of stocks and stock-related products, and that is how they make their money. When you consider that those same brokers are the ones buying up all the advertising time on the financial news networks, you can begin to understand why stocks get 99% of the air time. No one likes to bite the hand that feeds them.
But in 2009, some major banks (including B of A and Citi) are opening retail Foreign Exchange (Forex) brokerages, so I expect to start seeing a lot more coverage on the news shows once the "big boys" can find a way to earn commissions from Foreign Exchange trading.
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Question: I have a limited income (disability, Social Security, etc.) and only have $200 or so to start trading with. How soon can I be making the $1,000 a day you mentioned in your ads?
Answer: It's going to take you a while, but if you have the patience and the discipline to follow a set trading plan, as well as the Rules of Money Management, you'll get there a lot quicker than you might think.
When you start with what I call an under-funded account (meaning anything less than $1,000) you should start off by trading micro-lots (where the pip value is rated from $.01 to $.10). Don't worry if none of these terms makes any sense to you right now. I explain them all in great detail in my book.
Once you've built your under-funded account up to $1,000 (a process that will take you several months, but will reward you with some wonderful real-life trading experience in the process) you can switch from micro-lots up to mini-lots. These contracts carry a pip value of about $1.
After you start trading mini-lots, it is really up to you to decide which style of money management fits you best. You can follow a low risk, medium risk or high risk plan. Obviously, you'll get to the point where you are trading Full Lots a lot faster by following the high-risk plan than you will following the low-risk plan, but these are decisions you have to make for yourself.
Once you start trading full lots (where the pip value is $10 per pip) it becomes a matter of simple mathematics. 100 pips at $10 per pip equals $1,000. That means you need to make 100 pips a day to reach your goal of $1,000 a day.
But if you trade five full lots, your pip value is now $50 per pip, and you only need 20 pips to reach $1,000. Ten full lots only requires ten pips to make $1,000.
I run an online trade room (details below) where several of my professional traders routinely trade 10 lots per trade, and are making 200-300 pips per day in this volatile market we are enjoying at the moment. With pip values of $100 per, a 300 pip day works out to being a $30,000 payday.
From one morning of trading.
This is a goal worth working towards.
But you first have to crawl before you learn to walk. If you are starting off with an underfunded account, start small (micro-lots) while you learn to trade, and gradually increase the size of your lots as your account balance grows.
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Question: How much money would I need to start with to be able to start off by making $1,000 a day?
Answer: As I noted in the answer above, it would depend on how many pips per day you can make on a consistent basis. If you have a $5,000 starting account, you can justify trading one full lot while still keeping within the guidelines of conservative money management.
A full lot is worth $10 (sometimes a little less, but we use $10 because it makes this kind of math easier). If you can make 100 pips per day profit, you'll be making $1,000 per day.
If you can leave those profits in your trading account, you can then start increasing the size of your trades (from one lot to two, three, five, ten, etc.) and then you need fewer pips per day to reach your goal of $1,000.
Of course, if you continue to reach your original pip goal of 100 pips per day, by trading 10 full lots you would be making $10,000 per day.
Reaching this level when you start with a substantial amount of money in your account from the beginning ($5,000 or more) is actually quickly achieved, particularly if you can leave your profits in the account for a while.
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Question: I really like everything I've read so far, but I have serious doubts about my own abilities to spot winning trades, and otherwise turn myself into a profitable currency trader. Do you have some kind of mentorship program where I can learn from you directly, and maybe follow your trades for a while until I get comfortable with the idea of trading on my own?
Answer: In a roundabout way, yes I do. Last summer I finally gave in to the many requests I'd received and opened a Live Online Trade Room, where I spend each day making trades and discussing trading with a handful of professional traders who frequent my room.
The room is officially open from 8 a.m. to 4 p.m. eastern time Monday through Friday, to cover the New York trading session. While I am in the room live, I call out trades I am taking, giving you the name of the currency pair, my entry point, my stop-loss and my profit target. Several of my trader friends also do the same.
The benefits new traders get from spending time in the room are two-fold:
First, you get to focus your time and energy on Money Management, which honestly is the most important aspect of trading the Foreign Exchange markets. Many a sharp trader has blown up his or her account repeatedly by not following the sound principles of conservative money management, in spite of their ability to spot winning trades.
Secondly, you get to watch and hear us spot those winning trades in real time, and "learn while doing" as they say. There are several room members who started out with zero experience as traders, and within a week or two were spotting some great trades right alongside the experts.
Of course, there is that all-important third benefit of putting yourself in a position to immediately start making 100 pips per day, which is our initial goal each morning. We don't always get to 100 pips, but we get there (and beyond) often enough that most of my room members no longer work "real" jobs, but make their incomes solely from trading (and obviously, this includes the guys who are trading 10 full lots at a time and making $10-30,000 a day).
If you cannot join us in the Trade Room, I also send out longer term trades (those I think will last anywhere from a couple of hours to a couple of days) via email or SMS text message (to your cell phone). These trades are designed to make at least 200 pips profit. I will send out anywhere from zero to five of these trades in a week, depending on market conditions and assuming I can find profitable trade setups.
When you consider how much money you stand to make using one or both of these services, our annual subscription fee of $149 seems ridiculously small.
And it is.
But I'm keeping the price down because I want as many people to be able to access this information as possible while still forcing the room to pay for itself. I make the lion's share of my money from trading, so I don't need to charge $500 per month for this service like some traders do.
So you get full access to both the Trade Room and the emailed calls for just $149 a year (and $15 a month if you want the email calls sent via SMS text message to your cell phone).
If you are serious about making real money as a foreign currency trader, you cannot pass up the chance to work side by side with real traders, from the comfort of your own home or office, for less than $150 a year.
To learn more, visit the website devoted to my Trade Room Service:
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