Compounding in Forex Trading – What Is It?

Compounding in forex trading is the key to success. Why is that so? Albert Einstein once quoted, “Compound interest is the eighth wonder of the world. He who understands it, earns it. He who doesn’t, pays it.” He added that the math behind it was difficult and not very intuitive!

It’s understandable that many people don’t quite understand the concept of compounding fully. More importantly, did you know that compounding a small capital of £100 can earn you a return of over £150,000 in 1 year? Which is pretty good for a years wage when you think about it.

Here is an example. Starting with a £100 account and a 3% return from forex trading results, your money can multiply at an unbelievable rate. Let’s base this on a £100 account with a forex broker of your choice. If you can master the SetUpps™ Strategy topped with discipline you could make consistent profits just like I have done and continue to do the same for others.

So on day 1 your account balances is £100. In the beginning it seem unrealistic but you watch this; You end day 1 with a profit of £3 at 3% so now you balance has increased to £103. On day 2 of trading you start with a balance of £103 and again earn 3% of this balance equaling to £3.09. This now makes your new balance a sum of £106.09 at the end of day 2.

By day 20, which is 4 weeks of trading you would have an amount of £180.61 as your balance. You have to bear in mind that the forex market is opened from Monday to Friday here in the UK so a week would be 5 working days. Click the following link for more information about forex trading. Now that seem far away from the £150,000 plus that I mentioned earlier, right?

By continuing to stick with the SetUpps™ 3XS Strategy and being disciplined you would reach a balance of £1980.26 by day 100. Repeat the Strategy and by day 150 your account balance would have now reached £8175.64. As there are approximately 252 working days in a year we will end our last trading day on the 250th day. On day 200 your balance should be at £35841.20 and here is where things start to get interesting.

Due to the power of compounding in forex trading and our strict 3% daily trading target results your account balance would have totalled £161,837.15 at the end of trading on day 250. Having a good understanding of compound interest and how to make it work for you, rather than against you, is the key to achieving great results and earn a decent income.

The fact is that trading losses are inevitable and even professional traders loose trades in any given time however by using the SetUpps™ 3XS Strategy with a level of discipline, risk management and the right psychology you are bound to have more winning trades than losses.

So if you have found this article informative and would like to find out more about my winning strategy please do not hesitate to contact me. I offer one to one, classroom and Zoom sessions with a FREE initial 30 minutes assessment and to discuss the pros and cons of achieving your goals.

The Power of Compounding In Forex

We are not financial advisors but we have a successful trading system at SetUpps™ Trading that works for me, my team and for all our subscribers.

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