There are hundreds of thousands retail forex traders and institutions trading forex online every day. Millions of buy and sell orders are executed, which in total accounts for over 9 trillion dollar of daily (!) transaction volume. This makes Foreign exchange the largest and the most liquid market.
Many people of course want to grab their slice of a cake and this is why they engage in forex trading activities. While different people have different experiences, we are sure you would enjoy trading much more when listening to FxCritic’s advice.
Trading is risky and there are a few things you should remember before opening an account with a forex broker.
1. Trading is not suitable for everyone
We read this quite often on advertising materials of brokers, as they are complying with the regulation and warn you about potential risks. While it may sound stupid, trading is generally not for everyone…and quite probably is not for you too. Trading requires not only experience and knowledge, but also some mental skills. Depending on your trading strategy, you might need to quickly analyze the market and make fast decisions.
2. Don’t trade just because you can
In the past trading hasn’t been so accessible. It would require education, license and quite a significant capital. Today, forex trading is done on a margin and can be started with as little as 100 USD. Accessible trading doesn’t mean successful trading. This is why you should stay away from the market if you do not have what it takes to be a successful trader. Be ready to spend at least 10 hours a week to educate yourself and know that experience costs money.
3. Be aware of forex scams
There are more and more brokers appearing everyday. Some of these brokers are trying to provide best services to its clients and amazing support. Unfortunately, there are quite many brokers that are known as scams or bucket shops. Such brokers will do their best to make sure you cannot achieve or withdraw your profits. You should worry about deposited funds too. Don’t start trading if you don’t have reasons to trust your broker. Trust is vital. License is even more important.
4. Be ready for losses
As forex is risky, you may lose your capital quite fast. Of course there is an equal chance of earning fast too (as you generally only choose between buying or selling an asset). Many traders are greedy, this is why a winning trade may turn into a losing one. Not every trader can accept his defeat and close a losing position on time, that’s why some people get stopped out instead of hit stop loss. If you cannot face losing – don’t even start with forex. Trading is a process of earning more than you lose.
5. Greed is a root of all evil
If you are greedy – forget about trading. Many of us just want to sit at home, hit a few buttons every now and then, and make a decent living out of it. Some people believe that with a deposit of 1,000 USD they can acquire a beachfront house and a red sports car by the end of the month. Trading cannot be based on greed, if you look for 100% return on your investment, better go for casino.
Now you know why you shouldn’t trade forex. If you still didn’t get it, let’s repeat.
If you are not capable to trade – don’t do it. Start with Plus500 Free Account and see if you can trade before you make a deposit.
Trading takes both time and money. If you don’t have both of it – just give up now.
Stay away from bucket shops, there are many. Check out our broker reviews to pick up a trusted broker.
Forex is risky, so if you cannot handle losses – no point in trading for you my friend.
Trading is an art of turning 1,000 into 1,300 within a year, not doubling your money within an hour. If you are looking for the latest – don’t trade.