You may be wondering. Are free Forex signals worth it? It's important to understand that it may not be free as the owner of the signal service may receive a rebate on the spread margin so read the fine print to know what are any of the associated costs.
The likelihood is, the Forex signal service provider has put a lot of time and effort into finding a balance of risk versus
But what it comes down to, is your mindset going into it. Your approach to subscribing to these signals is very important.
If you are going into it with the mindset that free signals are going to make you a lot of money, then you are going to be disappointed.
Instead, there are several other helpful reasons why you’d want to consider using these signals as part of your trading strategy.
Using free Forex Signals to generate a healthy return
Every single trader has the end goal of making a positive return for their time and effort invested.
But many traders are sorely disappointed when they try and make the returns advertised by the forex signal provider when getting involved with Forex signals.
Looking for the highest possible return and not asking the question is my forex signal provider regulated can undo all your hard work in a second.
In Australia, all forex signal providers must be regulated by ASIC. Not just the broker who holds your trading account but the forex signal provider who is proving the signal for you. You can check whether the forex signal provider is regulated through the ASIC website.
Instead, your goal with these free signals is to see if this is something that could fit in with your trading and help meet your financial objectives.
Let’s look at two key questions you should be asking before, during and after you subscribe to a free Forex signal service.
Depending on the nature of the signals, you may receive them via SMS, email or phone. The one most traders prefer is SMS on the phone.
The challenge with Forex is it is a 24-hour market.
So, you need to consider the time frame of the signals coming through as you don’t want to miss out on any trading opportunities.
The next point to consider is the average hold.
Is the signal service a rapid-fire intraday trading signal or do they hold positions for several days at a time?
You want to make sure their average hold fits in with an activity level you are comfortable with.
Let’s get a few things straight right from the start. Firstly, Forex is risky, and you can lose more than what you start with.
Secondly, it is possible for Forex system providers to provide historical trading results with an amazing equity curve using a relatively high risk per trade. For instance, the system may have historically survived by risking 5% per trade.
This is too high. The returns may look great, but if you go into a losing period, you may experience a drawdown that you cannot recover from.
Ideally, you want to be able to adjust your risk management settings, so you are comfortable with the potential upside and drawdown levels based on historical results.
If you want to risk say 0.5% risk per trade, then ask the signal provider if that is ok.
Most trading systems go through winning and losing streaks. Your goal as a trader is to create risk management rules that allow you to sustain a losing streak but still have plenty of reserves to be in the game when a winning streak occurs.
There is an old saying by Ed Seykota, a pioneer of systems trading that goes: ‘There are old traders, and there are bold traders, but there are very few old, bold traders.’
For the full breakdown on why Australians should invest in Forex Signal Service, check out our article: What are Forex Signal and how they work?
We welcome you to give our team a call to discuss your investment goals and objectives.
You can call Walker Capital Australia on +61 2 8076 2210, and we’ll see how we can help you achieve your investment goals.