One of the biggest pitfalls many beginner traders fall into is that they have unrealistic expectations of results. While the futures, equities, and forex market can be extremely lucrative, it also takes the right kind of trading strategy to be a proficient and profitable trader that can actually make money consistently.

With that said, even with the best of price action trading strategies, you still need to have realistic expectations. Today, I’m going to talk about what kind of profits you can expect from trading any of the aforementioned markets on a regular basis.

Understanding Forex & Futures Trading for Beginners

Being able to set realistic expectations in the Futures or Forex trading markets means that you need to know what trading these different financial instruments is like.

What Is Forex Trading?

Forex trading is also known as foreign exchange trading, and this involves the buying and selling of currencies on a global scale. It's the most liquid and largest financial market in the world, with countless trillions of dollars traded on a daily basis. Forex trading takes place five days a week, 24 hours a day.

Beginners usually start forex trading by opening an account, learning to analyze charts, and then using time tested trading platforms. 

The main goal is to purchase a currency at a lower price and sell it at a higher price, or vice versa, with the aim being to make a profit. It sounds quite straightforward, but Forex trading is quite complex, although it is something you can easily get the hang of with a good FX trading course.

What is Futures Trading?

Futures trading is all about speculating on the future price of assets—anything from oil and gold to stock indexes. You’re not buying the asset itself but a contract that locks in a set price to buy or sell it later. It’s a game of predicting where prices are headed and aiming to profit from those movements.

Unlike trading stocks or etfs directly, futures typically traded on margin, meaning you can control larger positions with a smaller upfront investment. This can amplify profits but also ramps up risk. New traders usually dive in by setting up an account, learning to analyze market trends, and experimenting on trading platforms to get their feet wet. Futures trading can sound technical, but with practice and a strategy, it’s a skill you can absolutely master over time, just like forex trading.

Why Earnings Vary Greatly

Earnings in forex or futures trading can vary drastically, especially for beginners, in fact most traders will lose money at the start no matter what market they choose to trade. The forex and futures markets are both extremely volatile, with rapid price fluctuations occurring due to geopolitical events, rapid shifts in market sentiment, and/or economic news. Although this high-volatility creates great opportunities for profit, it also poses a lot of risk, particularly to those new to trading who don’t know how to properly position size.

Your own skill level and experience also play a large role in placing profitable trades. Without the basic knowledge of how to use your trading terminal/software, it's easy to make mistakes that lead to big losses. Furthermore, remember that trading strategies aren't one-size-fit-all. What works well for one trader may not work for another, and a strategy that works well in one market/trading instrument may not work so well in another.

Factors That Influence Profitability

Before we can talk about how much money you can expect to make trading forex or futures, you need to know the different factors that influence your profit potential.

Initial Capital and Leverage

Simply put, the more capital you have, the higher your potential for earnings are, but also the more you’re potentially putting at risk. If you start with just $500, you limit the size of trades you can place, and therefore the amount of profit you can earn. However, if you start trading forex with a larger sum of money, or by trading with a prop firm, it allows for greater flexibility and profit potential, but you also need to practice good risk management, or else you risk blowing accounts.

You'll also want to take leverage into account. For forex you’ll absolutely need to use leverage to build position sizes large enough, but for futures, you could trade the minis or micros depending on the size of your account. Again, if trading with a prop firm, they’ll have their own set of drawdown and risk rules, heavily based on the amount of leverage they offer in their accounts.

Risk Management

How profitable you are is also influenced by your risk management techniques. By never risking more than 1% - 2% of your trading count on a single trade. By defining clear risk limits, and setting well defined stop loss orders, you can improve your overall account durability and limit large losses that could potentially draw your account down too quickly.

Your first priority should always be to protect your capital and manage your risk. One of the most common mistakes made by beginners is failing to exit losing trades at their predetermined stop level, often hoping that the market will rebound in their favor.

Realistic Earnings for Beginner Forex Traders

With the basics covered, let's figure out how much money you can expect to make as a forex trader.

Earnings in the Early Stages

In the first few weeks or months of trading, you'll likely have some small wins, as well as large losses. Don't worry if as a beginner you're losing more trades than you're winning, because this is completely normal.

However, this is also why it's crucial for you to get educated by taking part in a good quality trading course. During the first few months, it's more about learning than it is about profits, and although you may make some profits, chances are that you'll actually lose money.

What to Expect After 1 Year

Once you've gained experience and become a more proficient trader, you should be able to generate returns of anywhere between 5% - 10% per month if you’re a consistent trader. Even 3-5% per month is a healthy profit if you’ve got a lot of capital or a lot of prop firm funding under your belt.

Tips for Setting Realistic Trading Goals

To wrap this up, let's go over some valuable tips for setting realistic trading goals as a beginner:

• Having a get quick rich mindset is a very easy way to over risk, gamble, and lose all of your money. Don't make impulsive decisions, engage in poor risk management, or over leverage your trades because you feel like you know what you’re doing. This is a marathon, not a sprint.

• It's also important to track your progress. By considering your win-rate, profit factor, and identifying if you’re taking impulsively invalid trade setups or making trading errors, you’ll get a very realistic idea of the kind of % return you’ll generate month to month.

• There are windfall winning months, average winning months, break-even months, and losing months. Don’t expect to make the same percent return every month. That’s not how trading works. Market conditions and seasonality play a huge factor in the number of trade opportunities for any given strategy. This is why its important to get a baseline of your performance over a 3-6 or even 12 month period to really measure your profitability.