Thursday, June 29, 2017

Forex Trading Risk You Must Know

May 30, 2011 by  
Filed under Forex FAQ & Latest Post


In today forex faq, we have a question from a new trader asking the following question.

Is it risky to trade forex? and can anyone earn a living from trading forex, I am new to the market and need to know how risky the market is. many thanks

The first impression that I often get from my friends when I tell them that I trade forex for a living is “Isn’t It Risky”. I often reply them by asking them whether it is risky to drive a car? Driving a car is not risky but if you do not have a license and you attempt to drive one, it is very risky.

It is the same for forex trading. If you know how to trade forex and have spend enough time to learn it, it is not risky. However if you think that forex trading is as simple as just buying and selling, I must say that it is very risky for you.

Personally, trading forex is not risky because we have the option of stop loss which will help to limit our loss per trade. Therefore I often urge traders to place a stop loss immediately after entering their trading position.

As for whether anyone can earn a living from trading, I will tell you DEFINITELY YES. I myself is trading forex for a living and I have friends who have quit their day job to trade forex full time.

However I must say that it is not as easy as what most of you think. It took me close to a whole to eventually make money from trading and it took some of my friends close to 2 years to make money. The key is perseverence as it needs a lot of time and effort to learn how to trade effectively.

If you are thinking of making money from trading, you definitely need to spend some time to go through a good forex course that will give you an effective trading strategy to trade with. Next you need to spend time to practice the strategy until you are good at executing it.

Overall, my personal opinion is trading forex is never risky as long as you are well prepared. What do you guys think? Do give your comment below.

Comments

4 Responses to “Forex Trading Risk You Must Know”
  1. Leonardos says:

    Forex trading is very risky business.I have lost a lot of money in this business,but I still like it.Many times I have thought of quitting and do something else,but what?My background is Economics and Statistics and forex trading suits me.I think its all about managing risk.
    To a certain extent I agree with you Kelvin that its not risky if you place a stop loss and any trader will do that.However,even with a stop loss there is an element of risk depending how many pips away from the opening price you place your stop loss.For example,daily charts usually have big stop losses therefore there is high risk compared to 15min charts.

  2. kristofa says:

    Trading forex is as easy as flying.
    It is risky to fly when you do not have wings. Training,
    learning and studying makes forex an enjoyable profession.
    The items above give you wings and you can fly according
    to the strenght of your wings.

  3. HA says:

    It is indeed very risky. From my personal experience , I lost big amount of money due to uncontrollable emotions and not learning enough. Always trade only with the money you can loose. Dont over do it else you will be burnt very badly. Never take revenge from market. Only trade when you know what you are doing and most important thing WHY you think that trade will go as per your trade. If you are able to answer and have strategy behind it. You will probably make money.

    I am also thinking of earning that much from forex so that I can leave my current job but it will take time anywhere between 2 – 4 years.

    So Be cautious the money you invest and the strategy you opt for. Kelvin’s website is really good for knowledge,information and strategies.

    Thanks
    HA

    • Kelvin says:

      Hi HA

      Thks for sharing your insight and I am happy that you have planned 2 to 4 years to learn how to trade and eventually quit your day job. Well Done.

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