Let’s see how much forex you have.
What if we put that information to the test against the $1,000,000,000,000. That is more than 4X the size of all other currencies (for more details check out this study.)
Well to be honest there isn’t much information out there about the true value of forex trades but there is enough research that we could make a few educated guess as to how much a trade that would get you in your day could earn you.
Let’s examine the different types of trading that are possible for the major currencies in the forex spectrum.
The first thing we want to do is determine the size of a forex trade and take a look at the risk involved, the market value, and whether or not we are in the high-risk position of making a trade where we make money.
The chart below shows the size of each currency and tells us what a risk free (or risk-free rate) trading market would look like.
The value of trade is dependent on the trading market so this one is based on a daily chart of the major currencies and forex market price to the nearest 1000. That makes sense since the daily price data for forex is the best and most objective to compare with. Let’s examine the different types of trading in more detail.
The chart below shows that if a trader wishes to make a market in any currency over $1 million dollars or just over $40 million in the US dollar, it will require at least $200,000,000.00 in forex per day and at least $30,000,000.00 in market value daily. Even at just over half that much a daily trade can result in over $300,000 per day of gains.
Some people may argue that the market is too volatile to trade at all in today’s markets so I would disagree with that but for purposes of this article we will assume that the market has settled down a bit. For example, here is a stock chart with the daily volatility for the three major currencies, the US forex market, and forex to the British Pound as of 2:13AM EDT on September 27, 2015. This is a great example of why forex trading is so complex and the numbers may not add up for some people.
What we are interested in is how much is enough to make a long-term trading success. If we multiply the daily price of currency