Forex trading practice is no longer news, not even to a lay man. It is known to many as a way of making great income, either as an active investor or a passive one. However, people still do not understand what forex trading is all about. Here are some misconceptions and facts about forex that anyone looking to invest into the foreign exchange market should know about.
THREE MOST COMMON FACTS ABOUT FOREX TRADING PRACTICE
1. PRROFIT MARGIN OF SUCCESSFUL FOREX TRADERS:
It is natural to want to believe that successful forex traders make a lot of money trading the forex market. The truth is that most of the successful forex traders make moderate but consistent profits from the forex market, which accumulates over time to amount to sizeable returns.
2. EMOTIONAL STABILITY PLAYS A VITAL ROLE IN FOREX TRADING PRACTICE:
Investing into a volatile and highly unpredictable market is risky and emotionally demanding. This may be difficult, but traders are advices to keep their emotions in check when trading the forex market. Better still, one can trade with auto trading tools to help combat emotional breakdown.
3. THE SIMPLEST STRATEGY IS THE BEST FOR FOREX TRADING PRACTICE:
Forex trading practice demands so much discipline in following the simplest strategy possible. Traders should avoid the use of many trading tools as this can cause confusion and unreliable reports.
COMMON MISCONCEPTIONS ABOUT FOREX TRADING PRACTICE
Here are three most common misconceptions about forex trading
1. A WAY TO GET RICH QUICK:
A lot of people think that trading forex is a way to get rich over night. It is not a gambling game where you bet on all of your chips hoping to get something big. If you play it like a gamble, then you will get poor quick.
2. FOREX TRADING PRACTICE IS NOT REAL:
It is not common for people to assume that forex is a scam. This is understandable considering the fact that there are a lot of scammers that pose as forex brokers only to dupe their unsuspecting clients. Also, the fact that it is only about 10% of trades placed in the forex market that are successful makes it all the more understandable for people to think that it is a scam. The truth is that it is not. Anyone that puts in good and quality work will get returns in due time.
3. IT IS POSSIBLE TO TRADE WITHOUT EMOTIONS:
“Do not trade the forex market with emotions”, that is one of the advice traders hear all the time. In a bid to heed to this advice, traders think it is possible to trade without emotions. However, this is not possible given to the human nature. So, traders are advised to use their emotions to their advantage, or cut it out entirely by strictly following a trusted strategy, or even an auto trading robot.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.