To beginners, starting forex trading in Nigeria can seem so complicated and confusing. In reality, starting forex trading in Nigeria can be simply done by anyone – provided that they are acquainted with the procedures involved.
It doesn’t matter whether you are a student, a housewife, an employee with a permanent job, or still unemployed. This is because Forex trading can be done 24 hours, 5 days a week, and wherever you are in Nigeria. All you need to have is a PC/Laptop/Smartphone and a smooth internet connection.
In this article, how to start Forex trading in Nigeria is summarized into five basic steps to guide you on your way to starting Forex trading in Nigeria. Here are the procedures involved.
How to start Forex trading in Nigeria
Follow these steps to start trading forex in Nigeria:
Step 1: Open a Forex Trading Account
A forex trading account is provided by a broker who acts as a liaison between you as a trader and the forex market. You can think of a forex trading account like a bank savings account. You can deposit funds into your bank account and make a withdrawal when you want – sometimes with an interest. Same way, when you open a forex trading account, you can deposit funds into that account to trade Forex. After a successful trade, you can withdraw the money you have deposited, including the profits.
Make sure you open a trading account with a credible forex broker. A credible forex broker would have a clear office address, an operational license from an authorized government agency, and a good reputation. We recommend Deriv.
After finding a credible broker, go to the broker’s website. Look for the “Open a Demo Account” or “Register a Trading Account” menu. After clicking on the menu, fill in the form that appears.
Generally, the trading account registration form will ask you to fill in your full name, residential address, active email, and/or phone number. There are a few other details such as account type and deposit currency type (generally USD), but they are not necessarily the same for every broker.
Because it is done online, opening a trading account is usually completed in a matter of a few minutes. Then, you will be asked to verify the account.
Usually, the verification process requires you to upload a photo or scan of your KTP/Passport /SIM as proof of identity, as well as a scan of a passbook/electricity bill/water bill/other bills as proof of residence. It’s a good idea to prepare these documents before starting the verification process so that they can be completed quickly. Deriv does not demand too many verifications like most.
Step 2: Download the Online Forex Trading Platform
When you are done with opening a forex trading account, you will have your username, password, and a link to download the trading software or application sent to you. Some brokers do not directly send a download link, but instead require you to log in to the Member Area, then find a platform to download and install. In the Member Area, you can also verify your account, manage funds deposits and withdrawals, and so on.
Furthermore, the link to download the trading platform(usually called Metatrader) can also be obtained from the broker’s website. Either way, the important point is that you can download the trading platform, install it on your PC/Laptop/Smartphone, then log in using the Metatrader account details provided by the broker.
Step 3: Simulation on a Demo Trading Account
After successful account registration and verification process, it’s important that you start on the trading platform with a demo account. A demo account is a trading practice account where you get to try out your trading ability with virtual funds before making use of your real money.
When you have successfully logged in on the trading platform, the amount of virtual funds provided by the broker for free for trading practice on the demo account will appear on the lower left side.
The virtual funds can be used to practice trading freely based on real-time market conditions. You can request another deposit of funds from the broker for free if the funds run out. However, profits cannot be taken because the demo account is only a practice account and the money is not real money.
How to start trading practice
There are several currency pairs you can trade on the trading platform such as EURUSD, GBPUSD, USDJPY, and so on. So, if you want to trade GBPUSD (Pound-Dollar) for instance, you will click on GBPUSD, then drag and drop it over the black background area on the chart. Later, the GBPUSD chart will appear there.
If the pound sterling strengthens, the GBPUSD chart will go up. Conversely, if the US Dollar (USD) is stronger, the GBPUSD chart will decline. You can make predictions whether the GBPUSD price chart will go up or down in the future using fundamental analysis or technical analysis by installing indicators such as Moving Average, Bollinger Bands, and others.
To place an order, click the “Buy” or “Sell” button above the chart. If you predict the GBPUSD chart will go up, click “Buy”. If you predict that the chart will drop, click “Sell”. Click the “New Order” option on the toolbar. An order form will appear where you can enter your prices for Buy and Sell. Right-click on the chart and select the option “New Order” or “Trading” to open the order form.
After the order is sent and executed, details of the order transaction will appear in the Trade history, above the Balance text in the lower left column. You only need to wait until the price moves up or down according to the prediction, before then making a Close Position (closing the trading position) by clicking on the related Trade history.
The time for the price chart to move to reach its target could be a few minutes, several hours, or even several days, depending on how much profit from your target price change is. Therefore, you must carefully plan an order, not just Buy/Sell origins. Learn various trading techniques, what indicators can be used, as well as Money Management to adjust the optimal risk/profit target proportion, and so on.
Step 4: Deposit Funds into a Forex Trading Account
After practicing trading on a demo account for some time, you may feel that you are ready to dive into real forex trading. For that, you must first deposit funds into your trading account.
You can decide for yourself how much to deposit based on the minimum capital requirements of the broker. Check the deposit and withdrawal rules on the broker’s website or in the Member Area. Various payment methods that can be used are bank transfers, e-payments, credit cards, and so on.
As a beginner, you should not immediately deposit enormous funds of up to thousands of US Dollars. Choose a local bank transfer method if you have one, or an e-payment method that is considered the fastest and least costly. Other methods can also be taken, as long as it is in accordance with the procedures specified by the broker. If you experience problems, don’t hesitate to reach out to your broker.
Step 5: Start Forex trading on a real account
After the broker confirms that the funds you sent have arrived in the trading account, you can immediately start real forex trading. The amount of funds can be seen in your Member Area or on the lower left side of the trading platform.
Note that you have to open a new account in the Member Area for real trading so that the platform login will use a different username and password details from the demo account login. The trading server used will be different, although the type of software and other features remains the same. You can also apply tried trading techniques on a demo account, to get profit on a real account. Having known how to start Forex trading in Nigeria, be careful not to enter into it with a get-rich-quick mindset. Take your time to master the art of trading on the demo account, then, start trading on a real account.
How to withdraw your money from forex
Many forex trading platform have their own methods of withdrawing. One of the reasons we recommend Deriv is how easy it is to withdraw your money.
If you go with Deriv, you can withdraw to your Nigerian bank account instantly. You can also choose to withdraw in bitcoin. And many more options.