Forex trading education - Trap 3: Deterioration
Ok, you have to arrange more money. You got a loan from some friends. You know that the currency will correct itself, but you don't know when will it come. If you've been there, you won't be there when it comes? For emotional reasons you can't close the position and you continue to get more loans and the loss continues to grow.
Guys, do you insure your homes? Do you pay a premium on your insurance? Do you have life insurance? You got car insurance?
The stop-loss order is your insurance premium, so that you never lose more than you can allow yourself to lose.
Do you know what a balance sheet of losing clients in the Forex market looks like? 98% of their transactions are profitable.
Most traders gain in small amounts and lose in huge amounts.
That's how most people go down.
But whoever knows how not to lose more than 2-3 percent in a transaction and whoever knows how to leverage, sets the risk in the Forex market to a loss of commissions only. And you know yourself and your character, and you know - no one will force you to leverage 100 fold.
Whoever knows that his character will not allow him to leverage and is not able to risk only 2-3 percent of their portfolio in a transaction, should not get involved in the Forex market. It is better for him to go gamble in Las Vegas, he'll enjoy it more there.
Whats Next?
* How to profit
Or go back to the Education index
Guys, do you insure your homes? Do you pay a premium on your insurance? Do you have life insurance? You got car insurance?
The stop-loss order is your insurance premium, so that you never lose more than you can allow yourself to lose.
Do you know what a balance sheet of losing clients in the Forex market looks like? 98% of their transactions are profitable.
Most traders gain in small amounts and lose in huge amounts.
That's how most people go down.
But whoever knows how not to lose more than 2-3 percent in a transaction and whoever knows how to leverage, sets the risk in the Forex market to a loss of commissions only. And you know yourself and your character, and you know - no one will force you to leverage 100 fold.
Whoever knows that his character will not allow him to leverage and is not able to risk only 2-3 percent of their portfolio in a transaction, should not get involved in the Forex market. It is better for him to go gamble in Las Vegas, he'll enjoy it more there.
Whats Next?
* How to profit
Or go back to the Education index
