2020 Forex Challenge – How much can I make per week, trading a 1000$ account?
How much can you really earn from trading Forex? Is 5-10% ROI per month reasonable? In February 2020, just weeks after we launched MastersTradingAcademy, our team had a discussion; “What ROI should we expect from our students?” – “What is considered a reasonable return on investment for a Forex trader?”. Especially now, during the Coronavirus outbreak, how will this effect my trading?
I suppose, at this time, I should give this a new title: How much can you earn from trading Forex during the Covid-19 outbreak? – oh well… let’s move ahead. Let’s define the problem – why am I taking on this challenge?
As a trader with an engineering background, I would hate to just pull numbers out of dark places. I prefer statistics, numbers I can rely on, tests and facts. This is why I wasn’t satisfied when discussing with my team members regarding which ROI we should expect from our students once we have taught them all we know.
At first, I Googled this topic and to my disappointment, I found articles that were not basing their data on facts but rather randomly pulling numbers: “Well, if you have this much then you should be able to make that much” and “people on Wall Street are making millions”… Let’s face it, neither of us are Wall Street traders with access to other people’s money to burn.
Therefore, I don’t like these kind of responses – and I am sure you, the reader, don’t like it either! Long story short… I decided to put myself to the test instead. I found my login details with a broker I used a few years ago to test a strategy and then abandoned when the account got burned.
The Challenge Begins – Trading a 1000$ Live Forex Account!
And thus, the challenge began! I deposited a 1000$ and began trading live. My first and current goal is to make 5% return on investment per week or walk away happy with 10% return on investment per month. Basically, I’m mainly looking for 50$ a week but I remain satisfied with 100$ a month as well. Hey, let’s face it, it is still much much more than anyone of us can get when our funds are just sitting in a bank account. Besides, Google big names like Goldman Sachs and George Soros and you will come to the conclusion that a monthly goal of 10% is really damn amazing!
- Earn a minimum of 50$ per week
- Withdraw the 50$ once you make at least another 20$ (this is to gain “mental leverage” – feeling that I am in the plus, in the money still even after a withdrawal – good strategy huh?)
- Trade only the two very popular assets: EURUSD and USDJPY
- Use price action… nails, claws and teeth… well heck anything that makes money! Jokes aside, I prefer scalping on a naked chart, just like I demonstrate in the videos on our YouTube channel.
- When a total of 1000$ has been withdrawn, re-deposit that money and increase the position size to 1.8-2.0$ pip value
- Current Pip value 1.5$ on EURUSD and 1.39 on USDJPY - same thing as 0.15 lots!
- Rinse & Repeat!
Why start trading with $1000 in my Forex account?
It doesn’t really matter what you start with so long as your risk to reward and money management are in relation to your total balance. You can do this same challenge but with 100 or 10 000$. I simply chose 1000$ because for this test, I was willing to risk that much or... that little. In many countries, you can come far with a weekly income of 5% on a thousand dollars. In other countries it may not even be worth your while to spend hours trading only to gain 50 bucks at the end of the week. In the end, the purpose of this challenge is to find out how much % you can earn, not what your starting balance should be! Oh, another reason is because I noticed that specific account had lost 1000$. Therefore, it seems logical to use this experiment as a means to earning back that lost capital - two birds in action speaks louder than a cat has 9 lives... oh... I think I messed that idiom up but you get the point ;).
Why withdraw the 5% instead of compounding it?
That’s another good question. If I am still going to re-deposit that money anyway, why withdraw it in the first place? My best answer is: psychology – yeah that’s the whole reason. If I don’t have a reachable goal, something I can actually feel like I’ve achieved, then things won’t end up working well for me. If I don’t withdraw the 5% ROI and then take a loss, then I will most likely end up trying to chase those losses. But if I know my 5% is safe, and what I am losing is only my "left-over buffer", I am more confident and don’t view that as a loss, but rather view it as an expected draw-down. This is simply a money management/mental/psychology strategy to keep me and my account in check.
When is the challenge considered completed?
As mentioned under “challenge rules”, first target goal is to accumulate 1000$. That’s our first goal. So, let’s focus on that. I also mentioned I started this challenge in “secrecy” in February, so obviously I have some updates for you already on how this is going for me!
Challenge Status so far, taken from the cTrader platform:
Withdrawals and ROI so far in 2020
It's been barely two months since I started and so far it's going well. Despite the Covid-19 affecting the markets. In fact, March was my strongest with a 76% win rate two weeks into the month. Here are the withdrawals I made so far - 3x50$:
That means, 750$ to go before we reach the 1000$ ROI - which is a 100% ROI on the total starting balance. Not bad huh? You think we can make it by July?
How you can follow my progress!
Now, if you are interested in following my progress in this Forex trading challenge, there are two ways to do it. I will mostly be blogging about them here on our website, but you can of course join us on Masters TradingAcademy Discord – we have a Forex trading group where we can talk and discuss the challenge, but also trading in general and you can benefit from our forecasts too. Once a month, or every 4 weeks I will update the progress here in our blog. The best way to know when they're out is to subscribe to our email list so we can send you a notification that a new post has been published. Don't worry, I promise not to spam you with 100's of emails! If we do, come in to our Discord and complain about it =).
You can find the subscribe box here under Blog. See you!