I just read this post at Babypips and I feel like sharing it here (Copy and Paste):
I have heard many newbies ask if they can make good profit with $500 or less. You can even do it with $100 capital but it will require a lot of patience and more discipline than with a larger account especially if you are not willing to set a long term goal and stick to a plan.
Personally I have tried using small amounts of capital and have been quite successful but also have failed in certain aspects. You see due to the limited amount of equity you will need to keep your open trades to a maximum of two, otherwise you will end up kicking yourself when you get in on a certain setup..
One thing that can also help you succeed with a low capital is HIGH LEVERAGE. If you’ve got $500 or less in your account, you can use a leverage of 1:500 to increase your pip value. But you must be very careful when using high leverage. You can do this by developing a good working strategy that you can trust.
For example a few months back USDJPY was in a very fast moving mode-I am sure it is now-
Ok so here is what I did and still do. I set my leverage to 1:500 and I watch this pair for at least 30mins each day. Starting from 10pm GMT in most cases, this pair will define its direction (you can only know its direction if you carefully monitor it at least 30mins for 10pm GMT). Once it has defined its direction (it could be an upward trend or downward trend), I place my trade. Since, I am sure that it will move at least 10pips away from my entry point, I usually buy 1 lot size (which makes my pip value $10). However, I make sure I close my trade after each 5 or 10 pip movements, no need to be greedy. With this strategy, I make at least $30 each day. One day I mad $350 in 5mins. – You can call this scalping. One reason why this strategy works for me is becauseProfiforex Forex Broker allows scalping and offers this 1:500 leverage plus tight spreads. I also take this risk because I can count on their execution speed to pull me out and get me in whenever I want. I am also increasing the Bonus I got from Best Forex Broker, Online Forex Trading Broker - PaxForex Both brokers are ok for me anyway, as long as I get to withdraw my profits.
Now, who says you can’t succeed with a starting capital of $500 or less. YOU CAN! With the right strategy, focus and discipline, YOU CAN
Here is a quote from a trader here
“Sometimes, I even trade the news! I wait for lvl 2 or lvl 3 news events and I trade the 5 minute gap after the release with either the way it moves drastically in favor of positive news or with a fade of that move based on news that was released in the previous 3 days from the currency that is being traded agains
US releases ADP number as positive, sell GBP/USD unless GBP released positive news within the same or past days otherwise I will wait 5-15 min until the good news rally stalls and I buy the GBP.
In any case it works for me as long as you have profit goals I usually take $5-$10 per trade as I am willing to build my account for many years to come! (Patience is the most important part of trading IMO)”
This trader also started with less than $500. You can Learn to grow a low capital.
Yes of course! And you have given good reason.
Success is not a matter of just investment. It is true that good amount is essential to make sufficient profit from trading . First make your self expert or skilled in trading then you can manage any amount $500 or less , will make a reasonable return from it too.
Exactly how much we are investing in forex is a secondary matter. what important is are you really in a position to trade well and can expect some returns.
500$ is enough for small business of forex. You can easily start business with this amount.
I would say $500 or less is much more enough to succeed through forex because if much capital is involve, I think there will be better return as profit if the market turn out in your favor and with good trading strategy.
Yes it is well enough to succeed through forex! In fact to many traders that way more than enough!
Give us a shot over at Freevestor we give you $500 in virtual funds and if you reach $10,000 - you win $500. It's a great test run for you to consider!
Yeah, that's true definitely. Because forex have a lot of risk involve but also with potential rewards too. That's why we need to investment the money we can afford to lose not the amount we will regret losing.
You are correct, sir. But we have to get used to the market and create our trading skill before investing big amount of money because forex is with risk and with good rewards also. I necessary don't need $500 or less if I don't have such amount of money since my broker do give me the chance start up with the minimum of $1 and above.
This requires patience and hard work, but am confident all of us on here are up and ready for it!