A lot of people, even professionals within the financial sector, will tell you that you need to invest in your future. This is a great idea, in theory, but is it the best idea? The facts indicate an active approach to your money is far better than just plopping it down into a couple blue chip stocks or a mutual fund and letting it sit. Some people do make money this way, but not a lot. And the majority of the people that do make money buying and holding do not make as much money as they could in other ways.
Historically, the Dow rises by about 3 percent per year. Not bad if you put a large amount of money into a fund 40 years ago and left it. $100,000, gaining 3 percent compound interest every year for 40 years would now be over $326,000 dollars. It would be over triple what you began with. That certainly sounds good, right? That’s what a lot of investing professionals and money managers will tell you, too.
But what if someone told you there was a better way? A much better way. There is, but the downside is that it takes effort and there is more room for loss. It’s the difference between investing and trading. Investing involves putting your money into a fund or an asset and just waiting. Trading is much more involved and requires a lot of effort, but the potentially huge increase in rewards is worth that effort.
Let’s look at that same $100,000 that you had 40 years ago. Instead of 40 years ago, though, let’s go forward 30 years. You now have only 10 years to grow your money. What do you do? Obviously, you want to make the most of the little time that you have. And that means putting your money where it will make you the most money. In the stock markets, you are considered amazing if you can make more than 10 percent every year on a consistent basis, so we will use that as a starting point. $100,000 at 10 percent interest for 10 years is still only $259,374.25. Good, but still off from where you were before.
There are some traders out there that can make over 100 percent every year, though. They do this in various ways. Some use Forex trading robots to get where they are, others use an aggressive approach with binary trading. These can both be very powerful, especially because you can gain 81 percent or so on a single trade with binary options. You won’t want to risk all of your trading capital on a single trade; that would just be stupid. But you can work your way up over time, growing your money slowly over the course of a year. If you have $100,000, risking $500 per trade will take some time to double your total, but it is possible. With 20 trades per day, over 350 days, you are actually risking $3,500,000 over the course of a year–way more than $100,000. Gaining $100,000 in this instance is actually not outside the realm of possibility. 81 percent of $500 is $405. With a 75 percent correct rate, you are gaining $2,162,250 per year and losing $875,000.*
*Amounts credited to your account for profitable trades.
That gives you a gain of $1,287,250 per year, and that’s more than 40 years of buying and holding or 10 years of active trading with a professional on Wall Street. Sure, not many people will hit this huge number. But some people will hit a bit more, while many others fall short of $2 million, while still making far more than $100,000. It’s not possible in some areas of the financial world, but in others, it has more potential.
***Your capital may be at risk. This material is not investment advice.***
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