Forex Trading For Millennials
Millennials are frequently characterised as having specific traits. While these generalisations may not always ring true, they can come in handy for people in this demographic who are interested in getting involved in currency trading.
If you fall into this age group, you can benefit substantially from being fully aware of the strengths and weaknesses generally attributed to millennials. Here are some traits you might want to know about.
For starters, many millennials have accumulated substantial debt. The class of 2015 is a perfect example, as nearly 71% of these graduates left their alma maters with student loan debt, owing more than US$35,000 on average.1)Retrieved 2 December 2015 http://blogs.wsj.com/economics/2015/05/08/congratulations-class-of-2015-youre-the-most-indebted-ever-for-now/ This percentage is far higher than the roughly 64% of students who graduated with loan debt 10 years ago.
Many millennials have been credited with having an entrepreneurial spirit.2)Retrieved 28 December 2015 http://www.forbes.com/sites/robasghar/2014/11/11/study-millennials-are-the-true-entrepreneur-generation/ This feature can be a blessing, helping to spur competition and innovation, but it can also be a curse. While this desire for young Millennials to strike out on their own can help them to make a difference in the world, it can also result in them generating streams of income that are unreliable.
This may be part of a broader trend, as companies are moving toward hiring more freelancers and fewer full-time employees. In addition, the gig economy, which involves people making money through opportunities such as Uber, has been gaining steam. Long gone are the days when people gave a major company 30 or even 40 years of their lives in exchange for a pension during retirement.
Even if you have a very stable income, it may be worth it to keep these developments in mind. In any case, harnessing a trading system that does not depend on a steady paycheck may have potential benefits.
While the aforementioned trends of rising debt and increasingly variable income have placed constraints on the investing abilities of millennials, the financial crisis has helped make them skeptical of the capital markets. During this event, many Americans saw their net worth plunge in a short period of time.
Risk is inherent to investment, and people in general are risk-averse. However, many have credited the financial crisis with making people even more conservative in their investing.
At some points, this desire to minimise risk has proved problematic, as it has prompted individuals to put their capital toward so-called safe investments that provide rather modest returns. While these individuals might feel comfort in the fact that their principal is relatively safe, this approach might generate returns that lag inflation.
Conservative Trading Systems
In some cases, a desire to manage risk effectively can prove beneficial, as it can help drive the use of conservative trading systems. Investors taking this route might decide to use little if any leverage, for example, which would help lower their risk of incurring major losses. The other side of the coin is that forgoing leverage would also reduce their chance of generating very high returns. Leverage is a double edged sword that can significantly increase losses as well as profits.
By using a conservative approach, you can cap your losses more effectively, thereby increasing the odds you will stay in the game long enough to get significant experience under your belt.
Millennials can potentially combine their desire for conservative trading with their high affinity for technology. Fortunately, the availability of financial resources has surged as a result of companies developing new technological platforms.
Armed with these applications and websites, millennial investors can obtain real-time access to information far more quickly than those in prior generations. Certain apps provide these traders with charting tools that make it easier to assess the global markets. In addition, harnessing these apps makes it easier to enter trades on the go.
Another resource millennials have on their side is time. By starting early, people in their twenties and thirties will have a greater time period to potentially accumulate wealth than older investors. They can also learn from experience and still have plenty of time to build up resources after accumulating some expertise.
Instead of making investing mistakes in their forties and then harnessing this information to make more effective trades, millennials can develop trading systems in their twenties and thirties, and then use the time they have available to get the kinks out.
Millennials are frequently characterised as being the generation of instant gratification. Put another way, they are described as having little or no patience. A recent global study showed 18 to 36-year-olds check their phones an average of 43 times per day.3)Retrieved 2 December 2015 http://www.entrepreneur.com/article/234531 While this desire for constantly available information may prove beneficial by keeping this generation informed, millennials must keep their desire for instant gratification under control.
Millennials have some distinct advantages they can use when it comes to trading such as being willing to learn and harnessing technology to make well-informed transactions.4)Retrieved 28 December 2015 http://www.forbes.com/sites/prospernow/2012/06/27/portrait-of-a-millennial-2/
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|1.||↑||Retrieved 2 December 2015 http://blogs.wsj.com/economics/2015/05/08/congratulations-class-of-2015-youre-the-most-indebted-ever-for-now/|
|2.||↑||Retrieved 28 December 2015 http://www.forbes.com/sites/robasghar/2014/11/11/study-millennials-are-the-true-entrepreneur-generation/|
|3.||↑||Retrieved 2 December 2015 http://www.entrepreneur.com/article/234531|
|4.||↑||Retrieved 28 December 2015 http://www.forbes.com/sites/prospernow/2012/06/27/portrait-of-a-millennial-2/|