Passive Forex Trading

Passive trading on the Forex
currency market is a great chance to provide a stable income even having a minimum level of experience and skills. The platform offers several ways of investing available for everyone. The advantages of passive trading are clear. Your task is to choose the most profitable and optimal way to invest and earn income.

Proven ways to invest include:

PAMM accounts;
trading advisors;
structured portfolios
copy trading (social trading).

Structured portfolios and social trading cannot be called full-fledged passive strategies. Although most of the work is done without the participation of the trader, nevertheless, he should regularly take part in the process. Let's figure out each method in detail.

PAMM accounts

This method of Forex passive trading fits beginners, as well as players whose budget is strictly limited. In this case, the trader invests his funds in the manager's account. You can choose a manager on your own based on your requirements, statistics, profit performance, and other parameters.

The advantages of PAMM investing are:

Affordability. One can start investing from a minimum amount: everything depends on a manager. The minimum entry of some brokers doesn’t exceed a couple of dollars. However, it is important to realize that minimum investment brings minimum income.

Simplicity. To start earning, a trader does not need to spend time learning and analyzing bumpy rides. A manager will solve all problems. Despite this, a good trader always aspires to self-education. Otherwise, any scammer can deceive you.

Time saving. A trader does not need to spend time analyzing the market, studying current positions, resolving issues, etc. All work is done by the manager. Your task is to choose the best manager by carefully studying his statistics. Mistakes in this case are unacceptable.

The disadvantages of PAMM investment include the risk of a complete loss of funds. In fact, you transfer your money to an unfamiliar manager who may make mistakes and lose everything. In this case, your income depends on the other person, not you.

Trading advisors
Forex trading advisors
or robots are automated programs designed specifically for making transactions. Hundreds of robots differ in the type of settings, principles of operation, and efficiency. Your task is to choose the appropriate option, or even better, use several robots at once.

There are fully automated and semi-automatic robots. Automated programs work without the intervention of a trader: they independently make decisions, analyze the market, open and close transactions. The task of a person in this case is to pre-configure the parameters. Semi-automatic ones just analyze the market and give signals to the trader about the right moment to make a deal. Further, the person takes all other actions.

The benefits of trading. Robots feel no emotions, which completely rules out the risk of a mistake because of inattention or fatigue.

High performance. The program can carry out hundreds or even thousands of studies daily, while the trader is usually fixed on a specific task.

24/7 operation. A trading advisor does not need rest: transactions are made around the clock without days off and holidays.

Simple and clear interface. Robots will be useful not only for experienced market players but also for new traders who do not have enough experience.

Possibility of changing settings. If you wish, you can always change the settings to meet your needs. However, you may do this if you know exactly why you are doing it and what consequences it may result in.

Important! When choosing a robot, you need to be careful. It is worth giving preference to reliable and proven developers.

Many beginners wonder how much money they can get and whether they need to pay income tax. The amount of profit is individual and depends on the size of the down payment and the case. As for the tax, if you’ve got a minimum profit, you don't have to pay anything.  

Structured portfolios
Not a very widespread tool for investing in Forex. The point is that a trader invests his money in the broker’s investment portfolio and expects an income within the time specified. The features of this method are:

Capital protection guarantee. Methods for protecting funds, as well as compensation, are discussed with the broker in advance.

Knowing the exact date of income receipt. In addition, the investor knows in advance the amount of profit.

No complications. The portfolio of assets is made without the investor’s participation. You do not need to go into details and sort out the nuances.

This method hardly suits beginners with a limited deposit, as in most cases the minimum investment threshold is over $2,000. You can invest for three months or more.

Social trading

The point of social trading is copying the transactions of more experienced and successful market players. Both a seasoned trader and a beginner may use this method. Even missing comprehensive knowledge you’ll be able to make successful transactions on equal terms with pros. First, you need to pick a market player and connect to his or her trading strategy. Then player's transactions will be copied to your account.

One of the methods of social trading is copy trading. This is a simple and affordable mechanism. Your task in this case is to choose the suitable trader whose transactions will be copied to your account. For this, the trader gets a commission, which is withheld from your income as a determined interest. The advantage of copy trading is a minimum threshold for entry.

Mirror trading is a more complex tool of social trading. This method fits big investors and needs more concentration and attention from a participant.

Using passive trading in Forex one can achieve a stable and large income. It’s better to use several tools at once. Even when switching to passive income, it’s always important to stay in the know. Remember that income on Forex is a real job while income per month or year fully depends on a person.

Contacts is not a financial services provider, but only a robot on the platform of the regulated broker Just2Trade Online Ltd is authorised and regulated by the Cyprus Securities and Exchange Commission in accordance with license No.281/15 issued on 25/09/2015. FXTM (ForexTime Limited) is licensed by the Financial Sector Conduct Authority (FSCA) (former Financial Services Board FSB) of South Africa with Financial Services Provider (FSP) license number 46614. RoboForex Ltd is an international broker regulated by the FSC, license No. 000138/333, reg. number 128.572. Address: 2118 Guava Street, Belama Phase 1, Belize City, Belize. All information published on this website is for educational purposes only and should not be regarded in any way as investment recommendation or advice, not even implied.

Hypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. The displayed results are a combination of real live results and hypothetical trading results.

One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results.

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