The foreign exchange market, a place of exchange where foreign exchange is bought and sold, or where various different currencies are exchanged with each other. It is well known that it is more difficult to make a profit buying Forex than it is to speculate in stocks. Before you start doing Forex, you need to know the following points, otherwise it is easy to lose money.
1. Invest only a small amount of money at the beginning
For example if you and your family currently have $1 million in savings, then it is recommended that you do not invest more than 20%. And bear in mind that unlike equity funds, if you lose money in foreign exchange, then you should stop injecting money. Once people have invested more money than their heart can bear, then they lose their original mindset and sanity and operate blindly, which can easily lead to the worst possible outcome. Be prepared to accept even a total loss before committing to foreign exchange, and never put in all the money you need to maintain your basic living.
2. Do not change the stop loss position you have set
It is recommended that we do not lose more than 2-3% of our total capital each time. This approach will maintain the stability of our capital and avoid the possibility of losing it all at once, and look for opportunities to slowly adjust to gain profits afterwards. If we change our stop-loss positions at will and keep expanding our stop-loss positions in the event of a loss, it is very easy to lose all our money. You should know that loss in foreign exchange is a common thing, we must firmly keep their stop-loss position.
3. Get into the habit of taking stock after a trade
At the end of each day's trading, we can record our trades, think about and analyse whether the choice of opening and closing a position in the trade was appropriate, what factors were received when making the decision, what charts and information we need to pay more attention to, etc. Whether you are making a profit or a loss, you should review and take stock in time to continually improve your adaptability and analytical skills, understand when you are more likely to make a profit and develop a good mindset. This is easy to do in the beginning but hard to stick to. I believe that partners who persevere will be able to improve their trading skills in the future.
4. Find a proper forex trading platform
In addition to understanding the foreign exchange system and laws, it is important to know the formality of the foreign exchange company, which will directly affect the safety of your investment funds. Formal trading platforms are not only regulated by regulatory bodies, but also offer a capital security protection scheme to maximize the protection of our funds. To determine if a platform is safe and trustworthy, it is important to look at whether the platform is regulated properly and effectively, and to check whether it has a regulatory number.
