A forex contest is a competition amongst currency traders from around the world to determine who has the best skills and trading discipline to make the most virtual profit in a specific time frame. The best trader will win first prize. While each contest may have a few unique rules in order to win the cash prizes, the actual contest is an opportunity for you to trade the currency markets in real time with live prices.
Most forex brokers offer demo accounts that will allow you to experience the actual trading of the currency markets. While this gives you the ability to test their trading platform, the actual results of your trading are the learning experience you gained.
Joining a Forex Contest
The entrance to participate in a contest is free. After you sign up, you will be directed to download a forex trading platform and login with the details provided by the hosting broker. The contest period may vary in the number of trading days, with the most common being monthly contests.
While you are waiting for the start date of the contest to begin your trading, I recommend you sign up for a free demo account from the same broker. Practice a few trades to learn the finer points of the software. Here you will learn things about the pip spreads, how the markets move in an actual trading day, how customer support handles your questions, etc.
Before the contest begins, make sure you read all the rules. Some contests will only let you buy specific currency pairs in order to win the top prize. Others limit the number of lots, some require you to post reasons for the trade you entered, some will let you use expert advisors and other programs, and some require you to have a real funded account with them. You don’t want to find out at the end of the contest that you did not follow the rules.
The Forex Contest has Started
Now that the contest has started, you will be able to place trades in real time. This is where the knowledge, skill, and discipline of trading will help you achieve the goal of winning the competition.
As you open and close trades, the trading platform will calculate the value of your portfolio and rank you from first to last with all the other traders. You can watch this on a daily basis. Some contests will also let you see the trades placed by the other traders.
The key to success in a forex contest is to utilize the same methods you would in a real trading account. While you could get lucky on a few trades, the true success will be in doing the things you should always do while trading: remembering to always put in stop losses, use money management skills and to bank profits. Yes, there is always some luck to winning a contest, but you have to be good in order to attract luck.
As the contest draws near to the end, you can reflect on what trades you made to get you where you are in the standings. If you lost a lot of money, did you forget to place your stop losses? If you did not place in the top money positions, what did the other contestants do that you didn’t? Go look at the trades they made and see if you can learn something from others.
The Forex Contest is Over
Now what? If you didn’t finish in the prize winning positions, you didn’t make any money. But the real winning is the lessons you learned while trading. You didn’t lose any of your own money, and you didn’t make any either. So, now you have some options. You can join another forex contest and try again or start trading in a real account with real money.
Trading in a Forex Contest will enable you to make money online as you continue to perfect your trading skills and give you confidence to start trading currencies with your own money.
