Forex beginners try different ways to increase their success chances. Some take forex trading groups to be more productive and avoid risks and mistakes. But do forex groups work, or are you better off trading alone?
Forex groups work if they offer you different arrays of expertise and knowledge. Group members can help divide responsibilities with everyone doing something they’re good at. They can also provide emotional support. However, you need high levels of management skills to minimize clashes among people.
In the rest, we will go through the pros and cons of trading forex in groups. Then, we will explain how to make profits by trading in groups.
IMPORTANT SIDENOTE: I surveyed 1500+ traders to understand how social trading impacted their trading outcomes. The results shocked my belief system! Read my latest article: ‘Exploring Social Trading: Community, Profit, and Collaboration’ for my in-depth findings through the data collected from this survey!
Table of Contents
Forex Trading Groups
Group trading is becoming a thing among retail traders, who get together as a team and trade in forex. They either meet at a physical place or online, depending on the group’s nature and purpose.
Banks, prop firms, and other financial institutions also trade as groups. They even hire traders to work for them, which is normal given their significant role in the forex market.
Working with groups of friends gives you flexibility regarding groups’ functions, members’ roles, and your collaborations’ scopes. It is up to you to decide how far you should be involved: Will you be all in, having to share the profits and losses, or just see it as an idea-sharing hub?
No matter what purpose it has, group trading could have both upsides and downsides.
3 Advantages of Forex Trading Groups
You Will Access a Wide Range of Expertise
Each person has specialized knowledge in one trading area. With a well-divided team, you can increase your efficiency by assessing more opportunities for trading. Instead of doing everything yourself, you can delegate the duties and share them among others. This way, you make decisions more easily because you can analyze opportunities more quickly and efficiently.
Your Work Has a Clear Structure
When everyone has a dedicated responsibility, work pressure gets divided among members, and no one bears the whole load. You could pool your capitals together to earn more significant profits. But it is up to you to decide if it is worth it.
You Can Give Each Other Emotional Support
Trading can be a lonely business. You have to sit at the computer all by yourself, accomplishing everything alone. But being in a good forex group helps you get the support you want, especially at times of uncertainty or when you experience losses.
When you share goals with your group mates, they can hold you accountable and push you to work with discipline. Also, you can receive motivation and constructive criticism from them.
Disadvantages of Forex Trading Groups
Like any teamwork, group trading has its downsides. For example:
- You may rely on the group thinking too much: It makes you unable to think independently and consider your preferences and trading styles.
- It may lead to chaos: Although different people can bring diversity to the group, it may not be easy to create harmony. After all, everyone should contribute to the whole group’s goal. So, they have to have similar views about the market and trading. Plus, members may not have the same levels of knowledge. If some group mates do not have enough experience, they may blow up your account by giving you the wrong information.
- You should decide to what extent you will be sharing: Will it be profits and losses or just information and expertise? If the former is the case, you should know who you are working with. Otherwise, you might end up losing your capital.
- It is difficult to decide who will have the final say: Should there be a hierarchy or all people will rank the same? If there is a hierarchy, everyone has to accept the order.
- You cannot make decisions freely: If you have a personal interest in a trade, you cannot do it if others do not consent. You need to go through with what the group says.
- Too many avoidable discussions: You may waste lots of time engaging in conversations to justify a particular choice or other arguments that naturally come with group activities.
- Making mistakes is more costly: If you make an error, you have to answer everyone in the group. When your blunder leads to the group’s loss, they may hold you responsible for their loss.
Should You Trade in a Group or Alone?
The decision regarding whether to trade in a group or alone depends on your personal preferences. If you are a beginner and do not know how to start, you may want to start with a group until you get a foothold in trading. On the other hand, you may need to trade alone first to consolidate your trading style and then decide if you want to work in groups or not.
Not everyone can work with other people, and trading in solitude is not everyone’s thing. So, decide what is better for your conditions, personality, and goals. Are you a person who can work easily with others, or are you better off alone? Eventually, it is your call to see with which one you are more comfortable.
If you want to trade in a group, the best thing to do is form a group where everyone knows and trusts each other. Appoint one person to coordinate ideas and duties and make the final decision.
So, if you can form a group where everyone shares their ideas freely, and everyone has to do something to contribute to the group, you may be more productive. Plus, if everyone makes their trades separately, they can avoid any future conflicts.
Ideally, everyone does their designated job, bounce ideas off other members, and then goes on to do their trading based on the shared information. This way, people with different styles can work alongside each other without any major clashes.
Online Trading Groups
You could also look for online trading groups, share your ideas and current trades with other members and ask for their feedback. These groups help you learn new things and give you great chances to find real expert traders. Joining an online group is also a great opportunity to polish your trading skills and review your trading plans and strategies.
But with this amount of spam forex groups online, look for groups that benefit you. Also, work with a group that gives you a positive feeling. Instead of joining an anonymous group, make sure a reputable person or company runs the group.
Never trust those who claim to give you free signals that will make you a millionaire. Most of these people are scams that will not give you anything in return for your money.
The best scenario is to take advantage of online groups as a source of wisdom to bounce your ideas off other experts. Then, try to do the trading yourself, not sharing the profits and losses with anyone.
Author’s Recommendations: Top Trading and Investment Resources To Consider
Before concluding this article, I wanted to share few trading and investment resources that I have vetted, with the help of 50+ consistently profitable traders, for you. I am confident that you will greatly benefit in your trading journey by considering one or more of these resources.
- Roadmap to Becoming a Consistently Profitable Trader: I surveyed 5000+ traders (and interviewed 50+ profitable traders) to create the best possible step by step trading guide for you. Read my article: ‘7 Proven Steps To Profitable Trading’ to learn about my findings from surveying 5000+ traders, and to learn how these learnings can be leveraged to your advantage.
- Best Broker For Trading Success: I reviewed 15+ brokers and discussed my findings with 50+ consistently profitable traders. Post all that assessment, the best all round broker that our collective minds picked was M1 Finance. If you are looking to open a brokerage account, choose M1 Finance. You just cannot go wrong with it! Click Here To Sign Up for M1 Finance Today!
- Best Trading Courses You Can Take For Free (or at extremely low cost): I reviewed 30+ trading courses to recommend you the best resource, and found Trading Strategies in Emerging Markets Specialization on Coursera to beat every other course on the market. Plus, if you complete this course within 7 days, it will cost you nothing and will be absolutely free! Click Here To Sign Up Today! (If you don’t find this course valuable, you can cancel anytime within the 7 days trial period and pay nothing.)
- Best Passive Investment Platform For Exponential (Potentially) Returns: By enabling passive investments into a Bitcoin ETF, Acorns gives you the best opportunity to make exponential returns on your passive investments. Plus, Acorns is currently offering a $15 bonus for simply singing up to their platform – so that is one opportunity you don’t want to miss! (assuming you are interested in this platform). Click Here To Get $15 Bonus By Signing Up For Acorns Today! (It will take you less than 5 mins to sign up, and it is totally worth it.)
Conclusion
Trading forex in groups can be highly beneficial because it gives you access to diversified knowledge and skills. It takes the pressure off your shoulders since you do not have to do everything by yourself.
However, you may find it challenging to reach a unanimous decision if you do not know who has the final say. Plus, there might be differences in trading styles that prevent you from getting a final decision.
If you can overcome the shortcomings and enjoy working with people, trading in groups can be beneficial.
BEFORE YOU GO: Don’t forget to check out my latest article – ‘Exploring Social Trading: Community, Profit, and Collaboration’. I surveyed 1500+ traders to identify the impact social trading can have on your trading performance, and shared all my findings in this article. No matter where you are in your trading journey today, I am confident that you will find this article helpful!
Affiliate Disclosure: We participate in several affiliate programs and may be compensated if you make a purchase using our referral link, at no additional cost to you. You can, however, trust the integrity of our recommendation. Affiliate programs exist even for products that we are not recommending. We only choose to recommend you the products that we actually believe in.
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