What age do people start trading?

According to an ancient Chinese saying, planting a tree was best done 20 years ago. Now, is the second best time. In this article, we discuss when it is best to get into trading and we go over the things that, regardless of your age, you should think about beforehand.

Your investments will typically increase in value over time if you can hold onto them for longer. Although that is accurate, the truth is that you should only start trading when you have some capital that you can afford to lose or be committed to for an extended period.

Trading History

When online forex trading first gained popularity in the early 2000s, the majority of the first traders to open accounts were experienced professionals with backgrounds in traditional phone and even floor investing of stocks, currencies, and commodities. This group mostly comprised of adult men and some women. People with no prior financial experience but a strong interest in online technologies emerged a little later during this period.

They were captivated by the idea of generating revenue with intelligence and technology, and without having to deal with the hassles of traditional offline brokerages. Naturally, adult IT professionals made up the majority of this group.

Since the late 2000s, as trading platforms and the Internet have become more widely used, younger people have been exposed to a substantial amount of information regarding the foreign exchange market.

Am I too young to start trading?

With the availability of cutting-edge information, traders and investors are beginning to start trading at younger ages than their predecessors. With just a click of a button, we can now directly access anything we want to know thanks to technological advancements. Fortunately, there are no age limitations on generating revenue.

For the most part, opening a brokerage account in your name requires you to be at least eighteen years old. At this age, a person is legally regarded as “an adult” and can sign contracts on their own. However, it’s never too early or too late to start learning more about trading, regardless of your age or level of experience.

How do I start trading?

Before you truly begin your trading career, there are a few steps you must take. You should first take some time to educate yourself on the market.

You can start by reading trading-related materials in this case. Fortunately, most brokers usually offer free educational material which is a nice start, especially for beginner traders.

In addition, you can sign up for some online webinars, podcasts, and more, which you can find on brokerage websites. 

You can also lose a lot of time watching trading-related videos. Observing experienced traders in action can teach you a lot about trading. Following all of this, you should also use a demo account to develop your trading strategy.

How to determine when you are prepared to begin your trading career is the next question to ask. After gaining more knowledge about trading and developing the best investing strategy, you should begin your trading career. Put differently, make sure that your trading strategy is working out. Don’t start trading if you constantly get more and more losing trades!

When is the correct age to start trading?

The best time to start trading is right away, as with earlier trading the results will potentially improve in the long term.

You will be exposed to the market at a young age if, for instance, you are introduced to trading in your 20s. Your trading career will potentially have a long runway to success if you have some successful trades.

Many well-known hedge fund managers who began their careers at an early age have achieved remarkable long-term success. Starting your trading career early also allows you to learn from your mistakes. For instance, you can simply move to another career field if trading isn’t the one for you.

Most importantly, you have loads of free time at your disposal when you are younger. It’s likely you don’t have a family or kids to support. The sooner you get into forex trading, the more time you will have to build a solid trading strategy that comprises tested strategies.

Is there a right age though?

The short response to this is no. Many people who began their trading careers at different ages have found success in the past. A 20-year trader who made a total of 110 million dollars trading Bed Bath and Beyond shares was the subject of widespread reports in 2022.

Those who began their careers early enough have historically made up a large number of well-known traders and investors. For instance, Ken Griffin of Citadel began his trading career while a student at Harvard University. Some, like Bill Ackman and Warren Buffett, began their careers in their early 20s.

Conversely, we have observed a great deal of prosperous people who began and were successful in trading when they were very old. For instance, a large number of senior citizens began and succeeded in their trading careers in 2021.

One of the advantages of trading is that it can be started at almost any age.

First off, because most forex brokers now provide a free demo account for users to try, the process has gotten comparatively simpler over time. With a demo account, they can access the market without having to put their money at risk.

The most advantageous thing is that learning resources are readily available online for either no cost or minimal cost.

Any drawbacks of starting early?

Trading is primarily about developing one’s knowledge and abilities. Most of the time, you will have to deal with the development of your traits, which can be difficult, particularly for those who lack experience. Further, it can be difficult to process the information.

However, it is hard to deny that younger traders have an advantage. The majority of them don’t give much thought to possible dangers or monetary losses. They typically trade without obligations, which frequently causes traders to pull back.

Indeed, they commit numerous errors right away. However, this process is entirely natural. The main benefit is that, in general, they restart more quickly after a loss.

Final thoughts

The stock market isn’t all that complicated. It functions similarly to an online supermarket where you can purchase or sell shares of businesses at different times of the day for different amounts of money.

The subject is quite fascinating once you get past the technicalities. The majority of traders will be eager to discover how their favorite companies operate. 

Age is undoubtedly a benefit when it comes to FX trading; older traders tend to have more life experience and are better able to spot risky situations and place less faith in seemingly good offers. A later start has the drawback of making it more challenging to pick up and develop new skills needed for potentially profitable forex trades. 

Younger traders are more likely to embrace new technologies and are prepared to put up with extended periods of losing trades while they are still learning. In general, it appears that traders of almost all ages are now entering the forex market on balanced shares, perhaps with a slight bias in favor of younger traders. By today’s standards, starting to invest forex at a young age is not too early or too late, as the majority of traders appear to be doing.

Disclaimer:
This information is not considered investment advice or an investment recommendation, but instead a marketing communication. IronFX is not responsible for any data or information provided by third parties referenced or hyperlinked in this communication.