Trading School: Learn Forex & Fundamental Trading

Have you ever wanted to start trading but been unsure of where to start? For new traders, trading can be both thrilling and daunting. That’s why we’ve gathered all the essential information for your trading journey in this step-by-step guide, perfect for beginners looking to learn from a trading school.

What is the best school to learn trading?

Step 1: Know how trading works

Buying and selling any asset without truly owning the underlying instrument—such as stocks, commodities, forex, or indexes—is known as trading.

Contracts for Difference (CFDs) are derivatives that let you speculate on an underlying’s price movements without owning it.

This merely indicates that the price of the instrument is “derived” from the price of the underlying, such as an ounce of gold or a company share.

The value of the derivative fluctuates in conjunction with the price of the underlying asset.

CFDs use a deposit known as a margin to give you full exposure to the value of the underlying asset at a fraction of the price.

Leverage will increase your profit or loss, so it’s critical to carefully manage your risk.

When investing, you will access these markets using a platform, like the MetaTrader 4 (MT4) and you have the option to go short (sell) or long (buy).

If you believe the price of the underlying will increase, you would go long. If you believe the price of the underlying will decline, you would go short.

In the event that your speculation is accurate, you would profit; if it is not, you would lose money. In other words, trading is simply making speculations about whether the price of a financial asset will increase or decrease.

Let’s examine an example of share speculation to better understand this. The value of the derivative will rise by the same amount if the price of a share increases from $100 to $105 in value.

If you bought the derivative for $100, you could now sell it for $105.00. Your profit or loss will reflect changes in the share’s price even though you never own the share itself.

About MT4

With a vast array of trading instruments, advanced charting, personalized indicators, automated trading strategies, and a sizable online community for support and education, MT4 has been used by millions of traders globally since 2005.

Step 2: Learn the key trading terms

Leverage & Margin

One tool used in trading CFDs is leverage. It allows you to fully expose yourself to an underlying asset while opening a position for less than the entire value of your trade.

This implies that your CFD broker will lend you the remaining amount after you pay an initial deposit, which is a small portion of the total value of your transaction.

For instance, to open a $1000 share position with a 20% margin requirement, you would need to deposit $200.

Since full exposure is still the basis of the position, trading on margin carries some risk.

You should put stop orders on all positions to make sure you don’t lose more money than you can afford because you could profit or lose money quickly.

Volatility

When markets are moving quickly, usually due to announcements, events, or market sentiment, this is referred to as volatility.

Although it entails greater risks by nature, if you have a solid trading strategy with extensive risk management procedures, you can also find potential opportunities.

Going long/short

Going long, also called “buying,” is a speculation that the price of a market will increase, while going short, also called “selling,” is a speculation that it will decrease.

Short selling is risky, though, because there is no limit on how much a market’s price can increase, and if risk is not adequately managed, losses could be limitless.

Step 3: Research the markets available to you

You be typically offered access to hundreds of assets across forex, metals, shares, commodities, futures and indices.

Access global markets with efficient execution, tight spreads, and the ability to diversify your portfolio.

Trade currency pairs, precious metals, stock indices, and CFDs on various commodities and futures, tailoring your strategies to meet your goals.

Step 4: Understand the risks involved and how to reduce them

Understanding trading risks and taking the right measures to effectively manage them is essential.

Limit orders and stop losses are two of the most popular tools to help you control your risk. If the market moves against you, stop-loss orders will automatically close your position.

Trading is accompanied by a number of risks. CFDs offer you greater exposure to the underlying asset at a significantly lower cost because they are leveraged products.

It’s crucial that you effectively manage your risk because any losses you get will be determined by the size of your entire position and may surpass your initial investment.

Step 5: Find out more about trading strategies and styles

Your personal preferences and risk tolerance will determine your trading style and approach.

Investing styles and strategies are not the same, even though they are sometimes used interchangeably.

In essence, the strategy is the method you’ll use as a guide for when to open and close positions, whereas the style is the primary plan on the trading frequency.

Some of the most well-liked approaches and styles are:

Position Trading
Swing Trading
Day Trading
Scalping

Step 6: Develop a Solid Plan from Trading School

An investment plan is a thorough decision-making tool that can assist you in achieving your objectives. It can address a variety of topics, such as which assets to invest in, when to invest in them, how much to allocate to a single position, and risk management techniques.

This plan needs to be tailored to your unique situation and adjusted to take your purchasing power and risk tolerance into account.

Step 7: Practice on a demo account

To test out what you’ve learned about trading, you can create a free demo account. You can practice trading with virtual money in this risk-free environment. You can choose whether you want to upgrade to a live account after you’ve become sufficiently confident and comfortable trading on the platform.

Step 8: Open a live account to start trading

You can open a live account with us after you’ve practised trading on a demo account and you believe your trading strategy and abilities have improved.

To open a live trading account, follow these steps:

To ensure the best experience, fill out a form that asks about your trading knowledge.
Verify your profile by providing identity and residential evidence.
When you’re ready to begin trading, deposit money into your account and get into trading.

Start your trading journey with the IronFX School

IronFX Academy is a comprehensive online learning trading school created to give traders the information and abilities they need to confidently navigate the financial markets.

It provides a wealth of resources that cover everything from the fundamentals of trading to advanced strategies, such as engaging webinars, downloadable eBooks, interactive courses, and educational podcasts.

Through interesting and easily accessible learning resources, the academy, which serves traders of all skill levels, aims to enable users to make informed decisions and maximize their trading potential.

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.