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benq
Number of messages : 13
Points : 871
Date of Entry : 2015-08-25
Year : 22

Risk in Forex Trading

on Thu Nov 05, 2015 10:59 am
Risk in Forex trading

Factors such as the size, volatility and global structure of the foreign exchange market have all contributed to its rapid success. The modern Forex trading technologies enable the taking of big profits in a short period of time: brokers provide their clients with leverages; client terminals support the function of automatic trading etc. Indeed, with Forex it is possible to become rich in a moment but it is also possible to lose everything at once.


Exchange rates volatility

Exchange rate volatility refers to the tendency for foreign currencies to appreciate or depreciate in value, thus affecting the profitability of foreign exchange trades. The volatility is the measurement of the amount that these rates change and the frequency of those changes. Price spikes can lead to financial losses. While opening a deal a trader should consider that prices are subject to various fluctuations. Therefore, it is necessary to control the opened positions or to place limit orders. 

Dynamics of prices is affected by various economic and political events as well. The release of breaking news can provoke significant price changes. Moreover, from time to time the central banks carry out the currency interventions in order to influence the exchange rate of the national currencies. Interest rates also play an important role as they can lead to the changes in exchange rates. 

The risk of using a leverage

The concept ofleverageis used by both investors and companies.Investors use leverage to profit from the fluctuations inexchange rates between two different countries. The leverage that is achievable in the Forex market is one of the highest that investors can obtain. Leverage is a loan that is provided to an investor by the broker that is handling his or her Forex account.  

The profitability of deals can be significantly multiplied if you use the assets borrowed from a broker. The higher the profit is, the greater the risks are. The losses cannot exceed the equity of a trader, but if a trader uses a big leverage, then even the slightest price movement in the opposite direction can reduce the deposit to zero. 

Technical risks

In order to control deals and to find a right moment for making a buy or a sell deal, a trader needs a computer and a constant access to the Internet. There is always a possibility of unexpected power cutoff, equipment errors or disconnection. As a rule such alternative devices as smartphones, laptops and tablet computers can be a good solution. 

Dishonest brokers

While trading on Forex there is a risk to choose an unreliable broker. Prestigious brokers are not really interested in losses of their clients. That is the reason why they try to ensure the maximum transparency of their activity and propose the effective trading instruments. Reliable companies neither deliberately change the exchange rates nor play against the client! 

Psychology of traders

 Available trading and high speed of deals execution can seem easy and simple. If you consider the trading as an exciting game, you can pay for this with your own money. A trader’s decision is influenced by various psychological factors. Therefore, it is necessary to learn how to control your emotions
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Mickytaylor
Number of messages : 16
Points : 570
Date of Entry : 2016-05-22
Year : 27

Re: Risk in Forex Trading

on Fri May 27, 2016 8:43 am
I recently heard that people had to wait for 45 days to get their withdrawal with 5Stars company? Is that true? I am really shocked to hear people waiting for so long to get their withdrawals. I am hope that I never joined them!
Mady Mackness
Number of messages : 78
Points : 633
Date of Entry : 2016-05-28
Year : 27

Re: Risk in Forex Trading

on Wed Jun 08, 2016 9:10 pm
You don’t reduce risk like that, it’s reduce by having knowledge and experience, if anyone tells you that risk can be reduced just because of broker selection then don’t waste time with such people. I believe risk will be lowered only after you gain knowledge and experience while these features are not something that will keep the risk down forever, it might do the job temporary  and ultimately we will find the risk been there.
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Stuart Broad
Number of messages : 178
Points : 674
Date of Entry : 2016-07-16
Year : 27

Re: Risk in Forex Trading

on Sun Jul 17, 2016 2:01 pm
In my view the biggest risk in Forex, at present is wrong broker. I see so many traders lose their hard earn money just because of wrong company and we recently heard about IronFX scamming trader, so one got to be really careful with how go with selection of broker.
Mady Mackness
Number of messages : 78
Points : 633
Date of Entry : 2016-05-28
Year : 27

Re: Risk in Forex Trading

on Wed Jul 20, 2016 3:30 pm
In my view risk is there with every business, but it depends on our ability whether we will decrease that risk or increase it and that’s through proper plans and methods, if we trade with proper planning then we could definitely do well, but if we are not good at planning then we will have obvious battle and difficulty.
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Stuart Broad
Number of messages : 178
Points : 674
Date of Entry : 2016-07-16
Year : 27

Re: Risk in Forex Trading

on Sun Aug 07, 2016 7:12 pm
I believe the biggest risk is wrong brokers; it’s where we got to be in good shape in order to work out things correctly. I faced massive battle with Instaforex in past, but luckily, I overcome all that and now I am happier.
Mady Mackness
Number of messages : 78
Points : 633
Date of Entry : 2016-05-28
Year : 27

Re: Risk in Forex Trading

on Mon Aug 08, 2016 5:30 am
I am sorry, but mostly we are our self to blame for when we talk about increase the risk. Firstly, I do agree broker got role in how we go about things, but still, I do feel it’s a lot to do when our preparation been very bad especially with lack in knowledge and obviously not having much experience, so this is what in real terms increases up the risk, so if we make effort to gain knowledge and experience then we will automatically push our self into better zone, but without those things, it’s next to impossible to make any improvement,
Mady Mackness
Number of messages : 78
Points : 633
Date of Entry : 2016-05-28
Year : 27

Re: Risk in Forex Trading

on Tue Sep 06, 2016 4:43 pm
In my view it’s not just Forex where there is risk, but it’s with all business, so we need to learn to handle the risk,
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Stuart Broad
Number of messages : 178
Points : 674
Date of Entry : 2016-07-16
Year : 27

Re: Risk in Forex Trading

on Mon Oct 10, 2016 1:20 am
Honestly speaking, I believe often the risk is self-generated which is to do with wrong choice of strategies and often wrong choice of broker. I have seen in front of my eyes my friend lose out on 200 dollars with ZezOption Company while wrong strategy is equally to be blamed, If we get these two things right than there is no risk at all.
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Stuart Broad
Number of messages : 178
Points : 674
Date of Entry : 2016-07-16
Year : 27

Re: Risk in Forex Trading

on Sun Nov 06, 2016 2:31 pm
Any business will carry some kind of risks whose magnitude depends on various factors. Basically, risks can be associated with your trading capital, trading skills, market conditions, brokers, payment systems, and the work! As such, you must be very clear on the risk factors before you enter this field. When I was new in forex, IronFx scammed me of around $200 and they have gall to still have their website up and soliciting funds!
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Stuart Broad
Number of messages : 178
Points : 674
Date of Entry : 2016-07-16
Year : 27

Re: Risk in Forex Trading

on Sun Jan 08, 2017 11:21 pm
Risk is always there, you just need to make sure you avoid wrong brokers, as through that it’s the risk that goes at unmanageable zone, I suffered heavily with InstaForex, so once you avoid wrong broker than things are automatically in easier play zone.
susu
Number of messages : 45
Points : 348
Date of Entry : 2017-01-23
Year : 27

Re: Risk in Forex Trading

on Mon Jan 30, 2017 8:08 am
As we all know each and every business have their own risk factor. You can’t do any business without risks. Trading options is also a business. It also has his risks. Risk is to lose your money drastically. Money often do over trading or do trade without appropriate analysis. In the result they lose their money. Moreover selecting a good option broker without research is also a big risk.


Last edited by susu on Mon Jan 30, 2017 4:31 pm; edited 1 time in total
Mady Mackness
Number of messages : 78
Points : 633
Date of Entry : 2016-05-28
Year : 27

Re: Risk in Forex Trading

on Mon Jan 30, 2017 9:37 pm
Risk is something you just can’t make disappear. I agree with the above guy about 2% risk. I always go with ½ risk reward ratio with 2-3%, I like it a lot with this setting because of lesser risk. I do enjoy it more due to Pepperstone broker and their 50% bonus on deposit, it’s sensational and helps me in every way due to no unwanted tags of restrictions or hidden policy, so that keeps me absolutely calm and cool with working.
Herald May
Number of messages : 21
Points : 325
Date of Entry : 2017-01-24
Year : 39

Re: Risk in Forex Trading

on Tue Jan 31, 2017 5:04 am
Ok then if we trade in a wrong way it will be a risky trade for me obviously. It's not the guilty of any broker because Forex market is risky for those trader who have scarcity of knowledge as well as technical ideas. So far we can not blame on broker for this. Yes we can trade with small lot to avoid riskes. Those who think it is risky they can use this formula.
Eric Young
Number of messages : 34
Points : 110
Date of Entry : 2017-09-07
Residence Country : Slovenian

Re: Risk in Forex Trading

on Thu Sep 14, 2017 10:15 am
We as a whole know every single business have their own risk factor. You can't do any business without risks. Risk is to lose your cash definitely. Cash frequently do over trading or do trade without fitting analysis. In the outcome they lose their cash. In addition choosing a decent broker without inquire about is likewise a major risk.It limit my risks in trading by losing with their bonus offer and restrictive trading sorts. I am additionally content with the individual account administrator allocated to me by the broker.
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