Focusing solely on forex trading

Judging by his lifestyle and investment portfolio, one would conclude that 24-year-old Mervin Yong Wei Yang has been bitten by the travel bug.

Having recently graduated from the Singapore Management University (SMU) with a degree in information systems management and a second major in finance, he has just returned from a seven-week long graduation trip in the United States.

Furthermore, while he currently plans to get a job in either the banking or IT sector, he also hopes to work as a freelance travel consultant, designing itineraries and providing advice on various travel destinations.

His wanderlust is thus reflected in his investment portfolio, which consists solely of trades in the foreign exchange (forex) market.

Q:What got you interested in investing?

A: I started investing in the forex market a year ago, when a friend encouraged me to learn the basics of forex trading with JF Lennon Institute of Financial Science, a financial education institution. When I first started, I used demo accounts at www.forex.com, which contains smaller spreads compared to other brokerages. Currently, I invest only in forex markets.

Q:What has been your experience in the forex market?

A: I try to fit my trading activities in the forex market into my lifestyle, rather than the other way round.

Thus, I survey the market conditions at my own time before deciding whether or not to enter the market, and there is hence no need to stare at the computer screen 24/7.

While trading in the forex market is risky, it is also easier to profit from it, as an investor is able to take both buy and sell positions and would thus be able to profit whether markets react positively or negatively.

However, I believe the key lies in managing one's money well.

You can't save too much if you want your money to grow; yet it is also important to limit your losses.

For instance, I set caps on my losses by placing stop losses based on my risk appetite.

Q: Given the volatility of forex markets, would you then characterise your risk appetite as large, and are you currently looking to diversify your portfolio?

A: Not quite.

I try to limit my losses as my risk appetite is not high.

In fact, I try to avoid large movements in my account, whether they be profits or losses.

I do not see myself investing in equities or bonds in the near future as I do not yet know enough about them, and conditions in these markets are currently not stable.

Q: What have been your best and worst investments so far?

A: My worst investment has been a recent trade in the euro/US dollar currency pair, where I lost 40 per cent of my trading account.

However, I managed to rebuild my capital over time through proper money management techniques.

Conversely, my best investment has been in attending the forex school, where I gained information on trading topics such as proper money management, a better understanding of market movements, as well as how to fit forex trading into my lifestyle.

Q: Before you entered the school, did you try your hand at investing?

A: Yes, I had attempted candlestick analysis and moving average analysis on my own by searching for information online.

However, that did not work out well as I saw many conflicting pieces of advice while combing through various websites.

I also lacked the time and resources to analyse charts prior to current trading days.