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Common Myths about Forex Trading
Written by: PaxForex analytics dept - Monday, 13 August 2018 0 comments
With the relatively new addition to the market of online retail forex brokers and a sharp increase in individuals trading for their own personal accounts, a number of misconceptions have arisen around the forex market. The forex environment is associated with many myths, which are popular especially among retail traders. Their trading levels differ, and it is generally rookies who tend to believe those myths or even pass them on. Not only those myths are untrue, they are hurtful both to you as a trader and your chances of success but also to the reputation of trading in the minds of the public who know next to nothing about it.
Among the most prevalent of forex myths that many newbie traders believe is that trading the forex market is easy. Trading currencies successfully can be one of the most challenging endeavors an individual can undertake professionally. While there are talented traders that tend to learn very fast, novice traders should dedicate a good amount of time and effort into practicing and developing strategies that they can later implement.
Perhaps the biggest myth about trading in the general public’s mind is that it’s all about making money fast. High risk, fast money, fast cars, etc. etc. The stereotypes that surround trading are so widespread that most beginning traders get into trading due to these stereotypes and so they start off with the completely wrong mindset and expectations. These expectations come to a
crashing realization once they lose a few trades and reality sets in. Succeeding in forex isn’t easier than mastering any other profession — it takes time, money and a lot of practice.
The days when only banks and large fund managers could access and trade in the forex have come to an end. With the advent of electronic trading via the Internet, as well as the availability of the forex market to small traders through retail forex brokerage accounts, just about anyone with a small amount of money and a reliable Internet connection can now trade in the forex market. A forex brokerage account can be opened today with as little as $25. Nevertheless, you will not be able to trade as aggressively with $25 as with $25,000, despite the risky leverage ratios offered by some brokers.
Forex trading offers individual investors an exciting and potentially profitable way to access the world’s biggest market – and it’s possible to make a good side income or build your portfolio’s value by trading forex strategically. Learning how the markets work, setting reasonable expectations, and approaching your first few trades with patience and a spirit of curiosity are great ways to get into forex. Once you’re an experienced trader, you may find that forex forms an important part of your portfolio and contributes to your wealth creation strategy.