ASFX Insights

How to 10X Your Small Account

By July 10, 2020July 17th, 2020No Comments

This is one of the most commonly asked questions in Forex.

“Austin, how do I start trading Forex with $100? $500? $1000? And how do I grow this account?”

It is possible, but before you read any further, you need to take a moment and realize that in order to achieve this growth, there needs to be a completely new mindset towards your trading account.

Take your previous definition of “growth” and throw it out the window. You need to start looking at growth as something completely different and new.

My answer to this question is different from other trading educators, it requires an open mind and the willingness to break previous rules and the shifting of thought patterns.

Here we go.

Going forward, treat your trading account like it’s your savings account.
Read that again and let it sink in.

Your savings account is not a get rich quick scheme. It’s a long term investment tool.  In order to grow a small account, you need to view your trading account in the same way. The goal is to get this account as large as possible.

IF you have a large account, this mindset still applies to you but to a different degree and that’s a whole other blog post.

New traders starting with $100, 500 or 1000 need to treat this account as something they can pump money into like a savings account.

When you’re talking about leaving your money in a traditional savings account, you will not get more than 2% a year return and if inflation is greater than the return from that savings account, then you are actually losing value of that money as it sits there. What this means is that, over time, you are losing money and you have no control on that money in terms of an investment.

So instead of pumping money there, pump it into a trading account, gain some knowledge and move that money forward. Take control of your financial future.

But Austin, what about a 401K?”

“It’s better than a trading and savings account because of a great return…”

I hear this rebuttal a lot, so let me break it down for you in terms of pros and cons.

PROS of a 401K:

  •  If you work for someone that gives you an employer match, that is technically free money but when we are talking about a 1% or 2% return, that’s free pennies.
  • The money in your 401K is taxed as long term capital gain, which can save you money.
  • It requires no work and you think you’re actively saving but in reality, you’re throwing that money into a fund and paying a LOT of fees when you could be managing that money yourself.

CONS of a 401K:

  • Your returns are capped, which means there is a limit to how much money you can make off your investment.
  • You have very limited control with who the money is invested.
  • The money that you put in is locked up til you’re 59.5 years old and if you take it out early you are subject to a fine.
  • There’s a max amount of money that you can invest.

Sounds like a lot of negatives for me.

The resolution is to start building wealth in your trading account.

When you do this, you have:

  • Full control
  • Unlimited gain
  • Unlimited deposits
  • Unlimited withdrawals without penalty

This seems like a no brainer to me.

This also takes away from the stress of trading.
No need to overleverage or over trade trying to build your account.

Unfortunately most people are intimidated by the thought of taking control of their financial future, but if you’re reading this blog and you’ve been nodding your head along with me, you do want this.
You want to take control and you can.

Ok Austin, what do I do now?”

If you don’t already have a trading account open, open one through a reputable and regulated broker like Oanda, Pepperstone, Forex.com etc. I don’t recommend a specific broker, but I recommend you do your own research and pick a reputable one.

After you have set up an account you’re going to:

  1. Put an initial amount of money into the account ($50, $100, $500, etc.)
  2. Fund this account through active trading with a profitable system.
  3. Pump money into the trading account, which means take extra income and put it into a trading account.

 

This is about long term investments.

 

It’s a new approach to treating your trading account like a long-term investment.

If you can consistently do 4% a month (which is a very low return) on your active trading account and you’re adding $100 to your account from other streams of income, your account is going to have $6000 more in it over the course of 3 years as opposed to if you didn’t add $100 a month.

 

Remember what I said and write it down:

  • Unlimited gains.
  • Unlimited deposits into your account.
  • Unlimited withdraws without fines.
  • Full control over your own finances.

You do not need to trade full time right away! Think bigger and think long term.

Find a proven system, pump money into the account and watch it grow.

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