It's possible to trade profitably on the Forex, the nearly $2 trillion worldwide currency exchange market. But the odds are against you, even more so if you don't prepare and plan your trades. According to a 2014 Bloomberg report, several analyses of retail Forex trading, including one by the National Futures Association (NFA), the industry's regulatory body, concluded that more than two out of three Forex traders lose money.
This suggests that self-education and caution are recommended. Here are some approaches that may improve your odds of taking a profit.
Prepare Before You Begin Trading
Because the Forex market is highly leveraged -- as much as 50 to 1 -- it can have the same appeal as buying a lottery ticket: some small chance of making a killing. This, however, isn't trading; it's gambling, with the odds long against you.
A better way of entering the Forex market is to carefully prepare. Beginning with a practice account is helpful and risk-free. While you're trading in your practice account, read the most frequently recommended Forex trading books, among them
Currency Forecasting: A Guide to Fundamental and Technical Models of Exchange Rate Determination, by Michael R. Rosenberg is short, not too sweet and highly admired introduction to the Forex market.
Forex Strategies: Best Forex Strategies for High Profits and Reduced Risk, by Matthew Maybury is an excellent introduction to Forex trading.
The Little Book of Currency Trading: How to Make Big Profits in the World of Forex, by Kathy Lien is another concise introduction that has stood the test of time.
All three are available on Amazon. Rosenberg's book, unfortunately, is pricey, but it's widely available in public libraries. "Trading in the Zone: Master the Market with Confidence, Discipline and a Winning Attitude," by Mark Douglas is another good book that's available on Amazon, and, again, somewhat pricey, although the Kindle edition is not.
Use the information gained from your reading to plan your trades before plunging in. The more you change your plan, the more you end up in trouble and the less likely that elusive forex profit will end up in your pocket.
Diversify and Limit Your Risks
Two strategies that belong in every trader's arsenal are:
Diversification: Traders who execute many small traders, particularly in different markets where the correlation between markets is low, have a better chance of making a profit. Putting all your money in one big trade is always a bad idea.
Familiarize yourself with ways guaranteeing a profit on an already profitable order, such as a trailing stop, and of limiting losses using stop and limit orders. These strategies and more are covered in the recommended books. Novice traders often make the mistake of concentrating on how to win; it's even more important to understand how to limit your losses.
Be Patient
Forex traders, particularly beginners, are prone to getting nervous if a trade does not go their way immediately, or if the trade goes into a little profit they get itchy to pull the plug and walk away with a small profit that could have been a significant profit with little downside risk using appropriate risk reduction strategies.
In "On Any Given Sunday," Al Pacino reminds us that "football is a game of inches." That's a winning attitude in the Forex market as well. Remember that you are going to win some trades and lose others. Take satisfaction in the accumulation of a few more wins than losses. Over time, that could make you rich!
Extreme Chocolate Cheesecake
Extreme Chocolate Cheesecake
Servings: ten to twelve.
Ingredients
For the crust:
- 8 oz. chocolate wafers, finely crushed (2 cups of crumbs)
- 3 Tbs. granulated sugar
- 7 Tbs. unsalted butter, melted
For the filling:
- 3 8-oz. packages cream cheese, at room temperature
- 10 oz. semisweet or bittersweet chocolate, melted and cooled
- 2 Tbs. all-purpose flour
- Table salt
- 1-1/4 cups granulated sugar
- 1 Tbs. pure vanilla extract
- 4 large eggs, at room temperature
- Chocolate shards or curls, for garnish
Preparation
- Make the crust:
- Position a rack in the center of the oven and heat the oven to 375°F.
- In a medium bowl, stir together the chocolate wafer crumbs and 3 Tbs. granulated sugar. Mix in the melted butter until the crumbs are evenly moist and clump together slightly. Transfer the mixture to a 9-inch springform pan and press evenly onto the bottom and about 2 inches up the sides of the pan (to press, use plastic wrap or a flat-bottom measuring cup). Bake until the crust is fragrant and slightly darkened, 9 to 12 minutes. Let the pan cool on a rack. Lower the oven temperature to 300°F.
- Fill and bake the cheesecake:
- In a stand mixer fitted with the paddle attachment, beat the cream cheese, melted dark chocolate, flour, and a pinch of table salt on medium speed, scraping down the sides of the bowl and the paddle frequently, until very smooth and fluffy, about 5 minutes. Make sure the cheese has no lumps. Add the 1-1/4 cups granulated sugar and continue beating until well blended and smooth.
- Add the vanilla and beat until blended, about 30 seconds. Add the eggs one at a time, beating just until blended. (Don’t overbeat once the eggs have been added or the cheesecake will puff too much and crack as it cools.) Pour the filling into the cooled crust and smooth the top.
- Bake at 300°F until the center jiggles like Jell-O when nudged, 55 to 65 minutes. The cake will be slightly puffed around the edges, and the center will still look moist. Set on a rack and cool completely. Cover and refrigerate until well chilled, at least 8 hours and up to 3 days. The cake can also be frozen at this point for up to 1 month (see make-ahead tip, below).
- Unclasp and remove the side of the springform pan and run a long, thin metal spatula under the bottom crust. Carefully slide the cake onto a flat serving plate. Garnish with chocolate shards and serve immediately. To cut, run a thin knife under hot water, wipe it dry, and cut the cake into slices, heating and wiping the knife after every slice.
Make Ahead Tips
To freeze, put the unmolded, cooled cake on a rimmed baking sheet in the freezer, uncovered, until the top is cold and firm; then wrap it in two layers of plastic and one layer of foil. Thaw overnight in the refrigerator.
