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Your Ultimate Guide to Trading a Small Forex Account

Forex trading can be very lucrative, but let's face it, even making a consistent return each month will not make you rich if you're trading a small account. 

Let me help you make the most of your Forex account, no matter how small. I will teach you how I trade and grow a small account.

Trading a Small Forex Account

"Most retail traders are undercapitalised, so they feel the emotional pull to trade large positions and high leverage. Let me show you how to make great returns, even with the smallest account. All my trades are verified - nothing is hidden."

Trading a Small Account - what you need to know

Retail traders don't have it easy

Professional traders have access to millions of dollars. They trade large positions and aim to earn an annual return of 10% to 25%. 

Only 10% to 25%, you say?! Yes, that is correct. A professional trader may have a $50 million account. Making 10% on this each year is $5 million a year! Not bad, huh?

However, retail traders mainly trade with accounts between $50 and $10,000. Making a 10% return a year on a retail account of this size is peanuts, so most retail traders have to double their accounts at least each year to make trading worthwhile. This makes trading incredibly difficult for retail traders - they are trading against professionals and aiming to make about ten times as much as them! It sounds ludicrous because it is! 

To make things more complicated, professional traders have access to more data and more experience. They have trading colleagues to bounce ideas off, are well-educated, and use Bloomberg terminals. Retail traders have none of this. In other words, they are at a significant disadvantage. 

It's possible

Despite the disadvantages and vast challenges of being a retail Forex trader, it is possible to trade a small account and make substantial profits, hence this page and the free trading series below. I will show you how to grow a trading account even when trading micro position sizes. 

Leverage is not needed

Most retail traders believe high leverage is essential for trading a small account. This is true if they're trading with less than $500. In my trading series below, I'll show you how I make significant returns trading a 1,000 GBP account with a leverage of 1:30. 

A leverage of 1:30 is adequate for most traders. Don't exchange a broker who has strong regulations and offers a reliable trading experience for a broker with high leverage. It is not worth it. 

To learn more about leverage, visit my Ultimate Guide for Understanding Leverage

Top Tips for Growing a Small Account

Cherry pick your trades

My best advice is to increase your position size but take fewer trades. I average one to two trades per week. These trades are well-planned and well-thought-out, including detailed fundamental and technical analysis. 

Taking multiple trades daily and risking a tiny percentage of your account will get you nowhere on a small trading account. Think bigger, but make fewer trades. Try to find the best trading opportunities. 

You need a wide range of opportunities to find the best opportunity. Find a broker that offers numerous currency pairs, including exotic pairs and crosses. Also, be willing to look at other markets - sometimes, there could be better trading opportunities in commodities and indices. 

I trade with CMC Markets, IC Markets, and IG

Don't day trade

This is the quickest way to blow a trading account or get a margin call. Day trading is tough; don't make trading harder by trying to feed your day-trading ego.

 

Stick with longer-term trades. In my series, you'll see that the 4-hourly chart is the lowest time frame I trade. 

Always have a healthy risk-to-reward 

A small account must have large winners - the bigger, the better. This is vital for account growth and trading morale. I suggest aiming for at least a 1:3 risk-to-reward ratio. My series covers trades of 1:10RR!

You must have the emotional discipline to keep winning trades open and cut losing trades as soon as possible. This is essential to succeed at Forex trading, whether trading a small account or not!

Don't rush any trade

If you rush to open a trade, you are likely trading emotion. Don't do it. Remain calm and take trades at your own pace. Enjoy the process; don't rush it. 

Have a trading strategy

You must have a trading strategy. This is essential. 

The strategy must be simple to follow yet sophisticated enough to give you an edge. 

The trading strategy in this series is the main strategy covered in my Ultimate Forex Course

"Let me share how I trade a small Forex trading account. The series includes live trading. All trades are verified by showing you my account history and myfxbook... You will learn a lot about profitable trading. I cannot recommend the series more highly."

Forex Trading Quote

Trading a Small Account - how to do it

Introduction

This is an introduction to this live trading series. It covers a number of items, including what to expect from the series, account size, and much more information. 

The purpose of the series is to help you know how to trade a small Forex trading account. 

The series can also be watched on YouTube here.

Trading TRYEUR - Carry Trading

A live trading example of carry trading. 

This trade will return over 100% a year based on the margin requirement. 

Trading USDJPY - Bank of Japan Intervention 

The power of fundamental analysis and using historic price action to forecast future price action. 

This trade was based on Bank of Japan intervention. The video covers analysis, entry, and exit. 

This trade was very successful -  a great start to the series. 

Trading CADNOK - Trading Interest Rates

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Growing a micro account

"To learn to trade like me, take my Ultimate Forex Course. I'll teach you everything you need to know to successfully grow a small trading account"

Trading EURNOK - Trading Interest Rates

An introduction to the live trading series. Covering a number of items, including what to expect from the series, how I trade, account size, and much more information. 

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