There are many things people avoid talking about when Forex is the main topic. Sometimes it’s because they think they could do better, and sometimes it’s because they don’t want to scare beginners. Whatever the case is, there are always some “secrets” in the trading world. You are likely to face it when you had your fair share of trading experience. There’s even a whole book about it, but let’s see some unexpected (and expected but often forgotten) things you will encounter as a trader in the Forex industry.
We all know many traders fail for different reasons, but did you know that the numbers go up to 80%? No wonder many like to bash on the trading industry even if they weren’t victims of a scam. The market is volatile, and you can’t predict things. You can speculate or be born with a knack for trading, but you can never be entirely sure. What many do is go into trading thinking it’s like the more predictable version of the lottery. “Yup, I’m going to buy and sell a couple of this and that, make money, and I’m out and rich”. That doesn’t even work in fairytales. The point is, many rushes into trading, and this is what makes the failure percentage so high.
What every forex trader should aim for is achieving your profit target. Why do then many fail? Because targets are unrealistic in most cases. Do you know what a realistic target is? Experts say your return should be no more than 5% a month. Everything more than that is too much, no matter how much money you have. What is also common is traders are scared of trading during volatile times on the market. They can have significant benefits, but they tend to be too impulsive and greedy, which leads to big mistakes and failure. High volatility periods are great, but pace yourself and seek help if you tend to go overboard.
Don’t go for the lowest price
While you can become greedy during high volatility, going for the lowest prices most of the time isn’t the smartest move. Get informed why the current price is so low and if it’s a current situation or something that will inevitably go down until it disappears and lose its entire value. What’s the use of that? Beginners often think it’s best to buy the cheapest, but think when purchasing the cheapest food, as an example. In most cases, it’s something wholly artificial and not good for your health. There can be situations when you came across a great discount, but if something is often cheap, something isn’t quite right. The same goes for market prices. Check why and how it happened, so you don’t wreck your whole portfolio.
Don’t trust everybody
Someone will rarely admit they don’t know everything when talking about a specific topic. That’s why you will come across people (even in your close circle), claiming they know a lot about the stock market and Forex; hence you should listen to their advice. These people (usually), talk bad about the stock market industry and say to you it’s all a big scam even if you are a trader for quite some time and you started generating income. Do yourself a favour and don’t listen to everyone’s opinion so faithfully. The same goes for signal providers. Many websites claim that automated trading works perfectly, and you will gain profit in no time. This is not the worst thing. What’s awful is that once you pay for automated software to provide trading signals, in 90% of cases, you will not get your money. Why? Because this software is made to sell you things, not to work as you want it. Some providers are doing a good job, but they are so rare you have to spend weeks researching different portfolios and records to spot one. It is why research is always the key and putting the knowledge into action.