This is not because of the many advertisements extolling the merits of the foreign exchange market that it is necessarily suitable to all individuals. The forex is, indeed, a market that is very risky on which it is necessary to be extremely careful.
Forex : a market that is unpredictable and complex
The foreign exchange market works 24h/24 and 7d/7. The value of each currency is constantly changing and it depends on supply and demand. For individuals, trading on the forex market amounts to betting on the rise or fall of one currency relative to another. To do so, they go through an online trading platform linked to a broker and use different tools.
If concretely negotiate on the foreign exchange market is simple, correctly predict the future movement of assets in which it invests, is far more complicated. Forex is more unpredictable, which means that, even with a strategy that is perfectly crafted, no one is really safe from a major setback.
90% of forex traders are losers
The market of international currencies is risky for individuals. According to a study conducted by the Autorité des Marchés Finnanciers, 90% of traders are losers. On average, over four years, they lose 11 000 euros.
In the short term, this can be explained by the fact that the currency pairs are extremely volatile. It is very difficult to correctly predict their evolutions. Forex traders have in addition available a tool called leverage effect which, instead of being used to improve the gains tend to serve more to aggravate the losses.
Risks of scam
Earn money on the forex market is already a difficult task but to do that, he still must find a broker reliable and professional. The opening of the foreign exchange market the general public has led to the emergence of many new operators and, among them, many crooks.
To avoid partnering with a broker wormy, it is important to conduct broad investigations. Don’t go to the sirens ‘ songs commercials that present the forex market as a place where one earns a lot and fast money because this is absolutely not the case.
You’ll understand if the forex market is accessible to all individuals, it really is only a handful of them. Start by opening a demo account with a broker to find out if you are part of it, or if it is better to find another activity more lucrative.