Monday, April 21, 2008

My Live account. Did it work for me?

I opened and funded my Live account with some trepidation because:

A: This was my first foray into Forex
B: This was REAL money
C: This was MY money

Now, I know that you are not supposed to invest money you cannot afford to lose, and this is exactly how I approached this excersise. However, to have lost it would still have grieved me. I do not have endless funds sitting in bank accounts and I had to stretch my resources to achieve this. My logic was that if it succeeded then I
would be better off, but if it did not, then I would have learned something about which, had I not
tried it, I swould have wondered and wondered about it forever.

There were other ways around it, of course. For instance I could have invested in one of those Forex systems which claim that you can begin investing for as little as $1. Yes, I know it is hard to believe, but that is one claim out there I have seen. Another, less sad way of doing it was to utilise one area of the brokers' that Freedom Rocks uses, and that was to open a mini account. A mini account means that you can begin investing with high leaverage (400:1) for as little as $100. I seriously considered this for a while, for obvious reasons. However, a little further investigation revealed that that small amount in conjunction with the small amount of interest earned and the limited number of stocks one could buy meant that at its very best performance it could never earn enough return even to cover the subscription to Freedom Rocks.

It was fortunate that I was able to find the next step up, which was, I believe, $2000. I actually managed to find $2500. This was an important figure to me, also, because it was the sum I "invested" originally in my demo accounts, and it would have been an interesting rule of thumb to compare them.

I wont bog you down with financial data. I wont even produce images of statements "proving" what I say. One reason is because we all know images can me manipulated, another is because I would prefer to keep some details private, and a third reason is... if you don't believe what I am saying what on earth are you reading this for?

I invested $2500. It has now increased to $2850, which is 13% over 12 days. I stand to be corrected, but if I do my maths correctly, then that works out at an annual interest rate of 425%!

Inclusive in the above is the interest gained, $14.35. Not a record breaker, that's for sure, but in context, it is $14.35 earned over 12 days and is equivalent to 17.46% per anum, which easily beats my local banks. It also beats my local lending financial institutions of which 21 have gone into liquidation over the last 12 months. Many of their demises triggered by the sub-prime lending debacle in the USA.

Damn it. I nearly got away with not mentioning global conditions that affect the world economy. I don't fully understand them, so that will be all I have to say for the moment on those.

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