A forex signal provider is a professional trader specialized in closely monitoring and analysing the industry, forecasting trends and making profits out of the forex market while constantly maintaining a low-medium risk trading profile. A signal provider practically sells his/her skills and knowledge by permitting other less experienced traders to follow and execute his or her trades. The trades are executed automatically in the follower's accounts in exchange for a small pre-established fee.
As the information available on the Internet is generally meant for signal followers to completely understand how this process takes place and what their advantages are, this presentation is mainly suited for traders that are interested in becoming providers. What exactly does a trader have to do to become a signal provider and how proficient should he be in order to be accepted? What are his advantages, risks and obligations once he starts trading in other people's accounts? Let's take them step by step.
First of all, professional signal services don't accept demo accounts so you have to take into consideration that if you are just trying your luck in this domain and thinking about getting some extra-money by letting others follow you, this is not the place where you should be searching for information.
On the other hand, no signal services platform is going to ask for your CV, professional experience or studies in forex trading when applying as a signal provider, so don't let this scare you off. You do need to have a real account and you do need to be trading with your real money - the pressure of knowing you can actually lose your own money makes a trader much more cautious and down-to-earth -, but what counts the most in terms of professionalism is your experience. If you have a positive performance history that proves you are not a high-risk speculator, but measuring your risk before entering a transaction and actually getting some profit out of it, then you are an appropriate signal provider. Not all automatic forex signal services apply the same criteria to establish whether a signal provider's trading history proves he is performant investor, but generally you can use this criteria to weigh your qualifications:
1. Minimum of 10% annual return on investment in your forex account.
2. Verified real account
3. Profitable performance during the minimum last 90 days with risk adjusted performance
4. Average pip/trade over 5-10
5. Due diligence on trading discipline and style
Once you meet these requirements you can just open an account with a signal service provider, connect your trading account to it and apply as a signal provider. Your account and trading performance will be analysed by a team of experts and once you get your approval you can start adding followers to your account.
A big advantage for the signal providers is that they actually don't have to be searching their followers, but their followers will be the ones looking for them. As a signal provider, your trading performance and style appears on a list from where followers choose the trader that suits their needs. Of course, it is desirable and advantageous for you to actually become active - post comments, details about your trading, make yourself easy to spot and market your trading as much as possible. Like this you definitely increase your chances of having as many followers as possible. And the more followers you have, the more your income increases, as you are paid accordingly.
It seems like an ideal situation, no? But be careful, as you should always keep in mind that any investor has the complete freedom to stop following you at any moment. Although it is in your own interest to make a healthy and sustainable profit, it is advisable to always take into consideration that other traders are following you and entrusting their money to you. It is a risk and a moral obligation that you have to assume.
FxStat is an innovating service for both experienced and novice forex traders, providing a wide range of new tools and information specifically meant to improve trading strategies and results. A completely secure and transparent platform, FxStat allows investors to analyze traders' strategies as well as their own performances, socialize and make new connections and get first-hand information about the forex market. With its latest launched automatic trade service, Tradebook, members have access to the first real-time auto-trading facility.
No comments:
Post a Comment