Which Type of Trade Is Best for Beginners to Make Money?

The best type of trade for beginners to make money is an approach that is less risky and easy to follow for beginners – swing trading – as opposed to day trading (intraday trading) and scalping is beginner friendly because it requires less screen time and less opportunities for over-trading and emotional trading.

Thanks to the development of the cyber landscape and the opening up of international money markets, trading is no longer the exclusive preserve of wealthy individuals and large financial institutions.

You too can now access this thriving multi-trillion-dollar industry — and yes, as a beginner, you can make money from trading with the right strategy, tools, and risk discipline.

As mentioned earlier – the most beginner-friendly type of trading for those looking to earn consistent income is swing trading.

Swing trading typically involves holding positions for a few days to a few weeks, offering ample time to make informed decisions, analyse setups, and reduce screen fatigue — making it ideal for new traders still learning how markets move.

That said, before choosing your preferred trading style, it is important to understand the instrument you‘re trading, the market environment, and your own risk appetite. Whether you’re looking at currencies (forex), stocks, indices, or commodities — your success will depend largely on how well you apply trading principles and strategies consistently over time.

Why Beginners Should Consider Forex or CFD Trading

What you need to understand about currency trading is that in this kind of trade, there is actually nothing you are buying or selling in a real sense. The currency market is primarily driven by speculation.

This means that there is no physical exchange of currencies that takes place. All that obtains is the entering of trade positions through online or desktop software. Entries from the trading software are netted out based on the market price.

If your currency trading account is dollar-based, all your profits and losses will be calculated and represented in dollar value in your trading account.

Platforms such as Pepperstone offer user-friendly forex and CFD trading environments for beginners, integrated seamlessly with powerful charting tools like TradingView. These allow you to analyse the market visually and trade directly from the charts, even as a novice.

What has spurred the development of the currency market is the necessity to enable the exchange of one currency into another for global corporations who have a need to exchange currencies continually.

A quick example of such needs can be payroll, as well as the payment of products and services from foreign sources. Mergers and acquisition activities also contribute largely to the need for such a currency market.

What Is the Best Thing to Trade as a Beginner?

For most beginners, major forex pairs like EUR/USD, GBP/USD, or indices like NAS100 or SPX500 are usually ideal starting points. These instruments offer high liquidity, tighter spreads, and access to abundant educational content and free demo accounts.

Using a regulated broker such as Pepperstone, FP Markets, or IC Markets gives beginners access to demo trading environments where they can practise trading in real time without risking real money.

Combined with TradingView’s free charting tools, this setup provides the perfect environment for learning how price action, support/resistance, and trend behaviour work — all while building foundational discipline and analysis skills.

How to Make Money Trading Currency: A Beginner’s Guide

Trading currency (forex) can be a lucrative venture when approached strategically. For beginners, the key lies in understanding how currency markets work, practising with the right tools, and managing risk responsibly.

Below are the core steps to help you navigate your trading journey and begin building profit potential — without getting overwhelmed or overexposed.

Step 1: Learn How Currency Markets Work

The first step you need to take towards making money trading currencies is to get a grasp of how currency works. This will give you a solid background to base on as you go about your trading drive.

You need a sound knowledge of currency trading in order to make the right decisions, choose the right currency trading software, and make sense of automated reportage and analyses so you can conduct profit-inclined trading.

Modern platforms like Pepperstone, eToro, and Exness offer free education hubs, webinars, and trading glossaries to help beginners understand how currency pairs move, what drives volatility, and how economic news impacts price direction.

Step 2: Secure Your Risk Capital

The second step involves getting what is known as risk capital for your currency trading endeavour. Risk capital refers to the amount of money you can afford to lose without ruining your financial life.

If you are already into trading, you can get this capital by freeing up some of your investments such as futures and stocks. If you are starting out, you can raise the money and then inject it into your currency trading account.

This is one of the reasons why beginner-friendly brokers such as AvaTrade and BlackBull Markets offer flexible minimum deposits and negative balance protection — allowing new traders to start small while learning the ropes.

Step 3: Practise with Demo Trading and Study Market Trends

The third step is about evaluating currency exchange rates. This entails studying how values of your chosen currencies rise and drop over time. One of the most helpful things to do in this phase is what is known as paper trading — also referred to as demo trading.

In doing this, your aim is to learn the ropes of making money in currency trading without putting real funds at risk. What you need to pay much attention to in your learning drive is learning how to assess the probabilities of currency values. Watch the trends between currency values closely and get your cues for actual trading.

Use TradingView’s demo tools or the MT4/MT5 demo accounts provided by brokers like IC Markets or FP Markets to practise reading charts and making entry/exit decisions without the pressure of real money on the line.

Step 4: Execute Your First Currency Trades

The fourth step entails implementing currency transactions. You can place these with your broker or through the features of your currency trading software. Using trading software enables you to track your investments and see where they are headed.

Beginners are advised to use simple order types like market orders and stop-losses, and avoid overtrading. Brokers such as Pepperstone integrate seamlessly with TradingView, allowing for direct trade execution from charts — an ideal feature for visual learners.

Step 5: Track and Record Your Trades for Growth

The fifth step is about keeping stock of the cost basis for all your implemented transactions. In some cases, you may have to record the prices paid towards current exchanges so that you have this data for annual income tax filing.

Tracking your trades also helps you build a trading journal, a crucial habit for every beginner looking to improve over time. This allows you to refine your strategy, recognise mistakes, and better understand your strengths as a trader.

Avoid Emotional Trading and Rely on Strategy

Avoid going through your trade on the basis of bizarre speculations on currency collapses. If you are in possession of credible information on a coming trend, then it may be worthwhile to consider buying or selling currency as a hedge. Software trading enables you to avoid the costly flops of emotional and impulsive trading.

With tools like automated alerts on TradingView, and mobile notifications from Pepperstone, you can stay informed and disciplined without having to sit in front of the charts all day.

Choosing the Best Trading Style for Beginners

While there are many ways to approach trading, not all trading styles are suited for beginners. New traders should choose a style that allows them time to learn without becoming overwhelmed by fast decision-making or high volatility.

Swing trading is generally considered ideal for beginners. It involves holding positions for a few days to several weeks — allowing traders to make informed decisions without needing to monitor the market constantly. This style reduces screen time and stress compared to high-frequency scalping or intraday trading.

Platforms like Pepperstone and RoboForex allow easy access to swing trading strategies, including built-in indicators on TradingView, which help beginners track trends and time their entries.

What are the best Instruments to Trade as a Beginner?

Many beginners start with major currency pairs such as EUR/USD, GBP/USD, or USD/JPY. These pairs have high liquidity, lower spreads, and abundant educational resources available.

However, others may find comfort in trading indices like the S&P 500 or commodities like gold — both of which have strong long-term trends and are widely discussed in market analysis. Brokers like Exness and Eightcap Partners provide beginner-friendly access to these instruments with fractional lot sizes and built-in trading tools.

The key is to pick an asset class that matches your knowledge level and trading timeframe.

How Much Money Do You Need to Start Trading Stocks or Forex?

You don’t need thousands of dollars to begin trading. Many brokers, including FP Markets and Axi, offer low minimum deposit accounts — sometimes starting from as little as $50.

However, a realistic starting capital for forex or stock trading is between $250 to $500. This allows you to take positions of reasonable size while practising risk management.

If your account is smaller, consider using demo accounts on platforms like TradingView, or opt for micro lot trading through brokers like XM Group, which let you gain live market exposure without risking too much capital.

FAQs: Common Questions from Beginner Traders

What is the 90% rule in stocks?

This rule refers to the idea that 90% of traders lose 90% of their money in the first 90 days. It underscores the importance of education, strategy, and disciplined risk management in trading.

Which trading is best for beginners?

Swing trading in the demo trading or paper money mode in the forex market is ideal for beginners. It allows traders to learn gradually, master their craft while managing risk and avoiding the pressure of real-time decision-making.

Is trading really worth it?

Yes — if approached with patience, a strategy, and capital you can afford to lose. Platforms like Pepperstone and AvaTrade make it easier to trade responsibly with professional tools and resources.

Can I make $1000 per day from trading?

It’s possible, but not typical for beginners. Achieving such returns requires skill, experience, and significant capital. Start by focusing on consistent growth over time. Also avoid coming to the market with profit targets – this will “force” you to trade and get into position even when the market is not conducive for such and is aligned with our trading strategy.

What stocks to buy for beginners?

Beginner traders should consider blue-chip stocks, ETFs, or major indices with stable long-term growth trends. Some brokers offer fractional shares, allowing smaller traders to invest in big names.

All the best in your trading and profit making dreams.