Forex Daily Review may make you rich if you are a hedge fund with deep pockets or an unusually skilled currency trader. But for the average retail trader, rather than being an easy road to riches, forex trading can be a rocky highway to enormous losses and potential penury. By Following HQBroker trading platform you will become rich very quickly.
Here are the reasons why the odds are stacked against the retail trader who wants to get rich through forex trading
Such as, a gradual move that heads the euro from 1.20 to 1.10 vs the USD over a week is still variant of less than 10%. Stocks, on the other side, we can easily trade up or down 20% or increase in a day. Although the allure of forex trading is based on the large leverage equipped by forex brokerages, which can magnify profits and also losses
Asymmetric Risk to Reward Most of the retail traders, however, do it in a different way around, making small profits on a large number of positions but then stabilizing on to a losing trade for a longer time and incurring a gradual loss. This can also results in losing more than our initial investment.
Imagine your plight if you have a bigger position and are not able to end a trade because of a platform malfunction and system crash , which will be anything from a power outage to an Internet load or computer crash. This type would include exceptionally volatile times when orders like stop-losses do not work. Although For instance, many traders had stop-losses in place on their small Swiss franc positions before the currency surged on January 15, 2015.
No Information Edge
The giant forex trading banks have massive trading operations which are plugged into the currency world and have an information edge.
The forex market is over-the-counter market that isn’t centralized and also regulated like the future markets. This tells us that forex trades aren’t guaranteed by a clearing organisation, which gives rise to counterparty risk.
Fraud and Market Manipulation: There have been frequent cases of fraud in the forex markets, such as Secure Investment, which disappeared with more than $1 billions of investor funds in 2014.