For Ibrahim Odongo, the decision to venture into forex trading came shortly after completing his Form Four studies, while waiting to join university. He had landed a teaching job at a primary school, earning a monthly salary of Sh12,000. Some of his former classmates, meanwhile, had found another source of income through forex trading.
Intrigued by their earnings, Ibrahim decided to try it out. Without telling his parents, he began investing a quarter of his salary in the market.
“I was enticed to start forex trading because my former classmates were making money. I asked one of them to teach me about the global market. He took six months to train me, and I paid him monthly,” he says.
Although Ibrahim and his former classmates passed their KCSE examinations and secured places at different universities, their friendship continued, this time through forex trading rather than the classroom. He initially deposited part of the savings he had made from his teaching job. They would trade together and share the profits equally.
Ibrahim Odongo is a fourth-year Computer Science student. He has been forex trading for three years.
Photo credit: Pool
“Excluding the six months of training, I have been doing forex trading for three years. There are times when I have blown my account completely, but I have also made profits. I have not stopped because I know forex trading is high-risk and requires analysis and risk management. Losing is part of the game,” he says.
Profits can be exciting, but losses can hurt, especially when the money invested represents months of saving.
“When I started making losses, it really hurt because I was not prepared. At the time, I did not have much insight into trading,” Ibrahim adds.
Two years later, after making what he describes as his biggest profit, he finally found the courage to tell his parents about his trading activities. Their reaction, he says, encouraged him to continue.
“I told my father about it but my mum found out from the screenshots I normally post on social media. Interestingly, I have never asked my parents for money for trading. Maybe one day I will ask them to deposit some money so that we can trade together and they can understand how it works,” he says.
Ibrahim’s relationship with his parents has remained good, partly because he has been careful about how he spends the money they send him for upkeep.
“Funny enough, I have never used my pocket money to trade. My capital comes from academic writing and the websites I develop.”
Asked why he did not tell his parents when he first started trading, Ibrahim says he wanted to understand the market and make some progress first.
“I now tell them when I lose and when I win so that they understand the market,” he says.
The fourth-year computer science student has never considered abandoning his course, although he regrets not knowing earlier that trading could become a career path.
“I wish to become a data scientist or analyst. Trading also involves data from institutional traders when they place their orders, and there is a connection with the course I am studying. I will utilise my skills to develop an automated trading strategy that will reduce the workload,” he says.
Bossman Bisengi, another fourth-year university student, has a similar story. His passion for technology drew him to forex trading, but, like Ibrahim, he kept his activities from his parents until he made a significant profit.
Bossman Bisengi is a fourth-year software engineering student. He has been forex trading for three years
Photo credit: Pool
“During holidays at home, my parents would see me busy on my laptop and become concerned. There was a time I was making losses, and they could see it on my face. They were really concerned. That is why I told them when I made a big win. It was a great achievement for me,” says the software engineering student.
“I used to spend the money my parents gave me, and they never took it lightly. At first, I did not tell them I was trading forex because I knew they wouldn’t understand,” Bossman tells Parenting.
His trading journey began in his first year at university. It became easier to finance his trades after he secured a job related to artificial intelligence, which provided him with money he could invest.
“I do not burden my parents. When I got some money for trading, I started gradually. There was a time I made a big win, so I had to involve my parents.
Bossman acknowledges that forex trading is a high-risk investment, but says the process has helped him develop his analytical thinking and concentration.
“We spend a lot of time trading because there are many things to consider. It involves analytical thinking, patience and discipline, which have made me enjoy the journey,” he says.
Bossman believes his experience might have been different had his parents supported him from the beginning.
“I have always been passionate about investment. I just wanted my parents to motivate and support me so that I could prove to them that life is about taking risks,” he says.
When the losses become real
For Victor Njau Ndungu, a third-year student pursuing a Bachelor’s degree in computer science, the allure of forex trading began while he was still in high school.
Victor Njau Ndungu is a third-year student pursuing a bachelors in computer science. He has been forex trading for two years.
Photo credit: Pool
“At the time, I thought forex trading was an easy way to make money and change my life. I used to see people on TikTok showing off expensive cars, living luxurious lifestyles and talking about how much they made from the markets. I also had a friend who seemed to be making progress through trading. That made me believe that I could also make it,” Victor recalls.
When he joined university and met friends who shared his interest, he did not hesitate to venture into trading. However, losing his first investment forced him to rethink his approach.
“I was young, ambitious and eager improve my financial future. What I did not understand was that people on social media were showing only the rewards, not the risks.
“When I first started trading, I lost all my money. I was really down, and I realised it was too risky to start without experience. I then began learning seriously and became more disciplined. Later, I found other online jobs that provided me with capital,” he says. Victor kept his activities secret from his parents.
“I knew they would tell me it was too risky. Later, when I started making profits and could cater for my needs, I became bold enough to tell them,” he says.
His mother was not pleased. “Apparently, some of my mum’s friends had lost their money through forex trading, and she believed forex was a scam.”
His mother was eventually persuaded when she saw that he was able to pay half of his rent, and offered him capital to trade. His father, whom he told later, did not react negatively. Unfortunately, Victor encountered another loss.
“My mum once gave me sh15,000 to trade, but I lost all of it. Life became very hard after that. I felt guilty, but my friend talked to me, and that helped.”
Victor now trades three days a week, leaving the other days for his classes. He has no plans to quit trading and is using his computer science training to develop his skills in quantitative research, which involves trading using mathematical and probability models. He believes his degree will complement his interest in financial markets rather than lead him away from it.
However, Victor acknowledges that he made a costly mistake when he first ventured into trading.
“I started with approximately Sh18,000, which was a substantial portion of my HELB money. That was one of the biggest mistakes I made because the money was meant to help me survive at university,” he tells Parenting.
How does forex trading work?
Forex expert Ezekiel Wasike explains that trading currencies requires an understanding of how exchange rates fluctuate.
“You need to understand the daily analysis of interbank rates. There are several major currencies that you monitor hourly to see how they are behaving, which currency is strengthening and which is weakening. That way, you can decide whether to buy a currency when its value is low and sell it a day or two later when its value rises,” he explains.
Several factors can lead to losses, particularly when traders make decisions based on expectations that do not materialise.
“If you speculate and invest a lot of money in buying dollars at a higher rate, but the rate later falls, you will end up selling at a lower rate,” he says.
Although forex trading is not new, Wasike says it requires authorisation from the government through the Central Bank of Kenya.
He observes that university students are attracted to forex trading by promises of high returns on online platforms, some of which may not be genuine. Wasike adds that trading requires substantial capital, which can be difficult for students to raise.
“Students have the notion that it pays faster than any other job or business, but the risks involved are greater than they think. Some people join platforms through others, make profits for a short while, and then the platforms are closed. You end up losing everything,” he says.
For students who want to pursue forex trading as a career, Wasike recommends enrolling at the School of Monetary Studies, where they can acquire relevant knowledge.
He says that while the calculations involved may appear straightforward, successful trading requires a thorough understanding of the market and the ability to monitor exchange rates closely.
“The dollar is the common currency now, and it is currently on an upward trend. If you use technical analysis, you can trade with a shilling gained on each dollar. That way, you make money.
“Technically, you need to monitor the market daily or even hourly, then calculate the average performance of each currency you are trading because, in business, we are always looking for profit,” he says.
Economist Hafsah Jumare shares Wasike’s concerns, noting that individual traders face competition from market players with access to faster technology and information.
“There are people in offices trading using supercomputers that are much faster. If there is even a change in the price of something, the computers detect it within seconds, before another person can. Even a millisecond makes a difference because they can buy or sell currencies quickly.
“Because of that, the average person cannot really compete. If you think you are going to make money on credit, you likely do not have the full information to do so. Some people use predictions about where stock markets will go to predict where forex will go,” she tells Parenting.
Jumare adds that students are particularly disadvantaged because they lack the expertise and information available to more experienced market participants.
“Allow me to call university students children because they are not yet experienced enough to determine which type of market they can join to make a profit. It is risky because online platforms can be a trial-and-error type of business. A company may be registered in another country, but you may not know whether it is genuine.
“If you come across an online platform promising that if you invest $50, you will get a reward of $1,000 in a week, they may simply be luring you into their business. They could turn out to be conmen. You may invest a lot of money, only for them to disappear with it,” he warns.
Psychologist Mercy Mwasi says that just like any other topic, when a university student tells their parents that they are into forex trading, parents should calmly ask what they already know about it before clarifying any misconceptions and guiding them accordingly.
“If a parent does not understand what forex trading is, they need to start with the information their child already has. If you do not have any information, please pause that conversation and resume it another time,” advises Mercy.
She also says there is a need for universities and parents to conduct financial literacy programmes and awareness campaigns on the risks of forex trading for the benefit of students.
“Forex has become like a disaster, and we are seeing so many issues, including a lot of stress, because it is very unpredictable.”
Forex trading can disrupt sleep and affect concentration in class when students treat it as a full-time job.
“There is no way a student will concentrate in class when they know that dollars are gaining somewhere because they have to be watching those charts. That then leads to a sudden academic decline, even among students we have known to be performing well.
“There is also guilt when a student has lost money they borrowed from a friend or that was meant for other things, like school fees or upkeep. Suddenly, everybody is chasing you, asking for their money, which then affects your social status. You end up going through depression, low self-esteem and hopelessness because you are not getting what you want. Forex trading is not for everyone.”
