Find Your Forex Trading Style With This Personality Quiz
While there are thousands of personality quizzes online, only a few will have a significant effect on your career and future earnings potential. The newly launched DNA FX quiz — aimed at helping those wanting to take the next step towards becoming a successful forex trader — is one of these few.
If you’re a budding forex trader looking to enter the market, but are worried about which trading strategy to use - or you are unsure about the type of trader you are in the first place - this quiz was designed just for you.
Why It’s Important to Find Your Trading Style
There are many different trading styles, and as history has shown (who can forget Richard Dennis’ turtle trading experiment in 1983), each of them has its fair share of merit. While some people choose to prioritise finding a trading mentor when they enter a career as a trader, this may eliminate an important first step for all new traders: understanding which style they are best suited to, based on their personality type.
It’s important to find a well-suited trading style before you embark on a career of forex trading, as your style affects your trading strategy, which in turn has an effect on the outcome of your work.
What Type of Trader Are You?
The DNA FX quiz was designed with this in mind, and by answering a set of fifteen questions, you’ll be able to get a better sense of which of the following trading types are best suited to your personality:
- Scalpers focus on a quick turnaround. They work towards profit based on short-term price swings, regularly making evaluations of price action.
- A scalper puts a lot of emphasis on their entry, exit and risk management parameters.
- With a fast pace to their work, this type requires emotional discipline, as it involves high risk, offset by an opportunity for above-average gains.
- Not to be confused with scalpers - albeit that both are focused on short-term returns - pattern traders (as they are also known) will avoid holding anything past session close .
- Day traders operate in high volumes in comparison to other types, with a leaning towards short-term swings.
- To be a day trader requires a personality type capable of handling high-pressure situations. You should have a share of open-mindedness and flexibility: no two days are ever going to be the same.
- A position trader takes somewhat of an academic approach, regularly focused on long-term macroeconomic and geopolitical changes.
- Positions traders will often use technical tools to manage risk, and are generally fairly tech savvy.
- Analysis is central to these types of traders, so a quiet proficiency for statistics and an enjoyment of working with numbers becomes significant in these character types.
- Swing traders tend to benefit from fluctuations over the course of several days up to a few weeks.
- For them, technical analysis is paramount. These traders are well read and have an inherent understanding of the relevant fundamental themes around forex.
- Swing traders tend to require greater patience, with the ability to compartmentalise, especially when there are short-term fluctuations which may attempt to steer existing strategies off course.
- These traders capitalise on volatility and spikes triggered by political and economic changes around the world.
- Highly intelligent and with a keen focus on current events, they place great value on economic statistics, monetary policy changes, elections and speeches from global leaders.
- Risk-takers who have a habit of following current events, have an eye for detail and a knack for speculation tend to be a good fit for this type.
- Algorithmic traders make trading decisions based on an automated algorithm, coded by the trader themselves or bought as computer software.
- The software does a majority of the analysis, spotting important sequences and trends, in order to generate buy or sell signals.
- Those who adopt this style tend to be more risk-averse, focused on improving the system itself, and using each day as an opportunity to learn and change approach.
Take the Personality Quiz for Forex Traders
If you’re curious about your type, the DNA FX quiz is a simple and effective way to find out which style you are most suited to.
While the questions are tailored towards new traders looking to solidify their type and strategy, existing traders could also learn something new about themselves, especially if they are looking to implement strategy changes heading into the 2020s.
As a whole, the test lays the foundation for anyone with an interest in trading, helping them to have a better understanding of themselves and become a better trader in the process.