Description: It is common knowledge that foreign exchange trading is not for everyone. Here is a quick look at different groups of traders that should avoid this market
Many people are tempted to sign up for forex trading because of the promise of great profits, but what they do not know is that foreign exchange trading is simply not for everyone. Therefore, while you are getting all pumped and excited about starting your trading career, you may want to hold off a bit if you fall into one of the following categories, or else that smile on your face that is there because of the potential profits you are expecting could quickly turn to a very pronounced scowl.
Categories of people that shouldn’t be in foreign exchange trading
People on a very tight budget
As a beginner to trading, the chance of losing your first trading account is as high as 60%, regardless of the number of hours put into the learning process. That figure goes up to 95% if you add the extra pressure that stems from going into trading with an amount of money you simply cannot afford to lose; plus the added pressure of having to make as much money as possible. When you are under pressure to make money from trading, you are going to end up blowing your trading account. So instead of gathering all the money you have left and going into trading, it is advised that you rather get a job first and foremost then after saving for a while, you can consider going into trading.
Stay away if you can’t take losing trades
In other areas of life, it is advised that you keep holding on even when everything is looking bleak. In forex trading however, this is a sure way to a blown trading account. If you cannot take a loss every now and then foreign exchange trading is not for you. The most successful traders are those who leave the trade as soon as their stop loss level gets hit and not those who keep moving the stop loss or take it away entirely simply because they cannot stomach a loss.
Those who cannot take risks
Some individuals hate anything that involves taking significant amounts of risk. If you cannot open up to some amount of risk, then trading is not for you. On the other hand, if you love taking risks too much, you will do well to stay away from foreign exchange trading. The reason for this is that most people who love taking risks are the same ones who will enter a trade with 80% of their account at risk and as soon as they hit the buy or sell button they start praying and hoping things work out well! Unfortunately, it rarely works out well for such trades. Even if it does, the trader will repeat the action again in the future and he will definitely not be as lucky.
People who do not have time
If you simply do not have the time for trading, it may be best you hold off on it for a while. Granted there are different kinds of provisions that help traders make money off the market even when they are not part of the trading process, but it takes time to be able to successfully analyse any signal provider or account manager you are going to use.
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