Forex is a popular term now, and with its constant service to the investors, it has earned so fame. Every day a great number of people are joining here to change their fortune. But, the problem is that this platform does not serve equally to every investor. This statement may seem a little controversial, but we have nothing to do but accept the brutal truth. We will discuss the reasons behind this for beginners so that they can easily picture the industry before jumping into the fire and getting burned.
Expectation vs. Reality:
Participants
If we consider the participants of the Forex market, we will find that most of the currency pairs are dealt with major central banks, commercial banks, giant financial companies, and retail traders like us. Our investment is small compared to those market changer’s deposit. This difference in the deposit works as the game-changer in the market in terms of profit gain. Though trading on Forex looks very attractive, it is not a place for the small investors who may lose even their bread and butter with a slight mistake in their investment.
The rookies may be thinking that knowing about the participants of the Forex market is not a big issue. But if you dig enough, you will realize every details about the market increases the chance to make more money. Knowledge is the most powerful thing you can have as a trader. Work on your skills so that you can deal with the different states of the market. And when you spot a major change in the trend, try to find out the key reasons. This is where knowledge about the participants will become a very important issue. So, never take backstep when you have the opportunity to learn about the market pariticpants.
Research
Big companies invest a huge amount of money in market research, and this is such an endeavor that we can hardly imagine it. Beginners conduct their FX research manually by reading a mere chart. I hope you can draw a line now between our manual research and the automated algorithmic research of the big companies. For this reason, it becomes easier for them to get big profits from the market easily. Explore the contents of the link https://www.home.saxo/en-sg/products/cfds and enhance your researching ability. By learning more about CFD market, you will be able to take better decision like the top traders in Singapore.
Small investors take the help of the fundamental analysis, and everyone has to accept the fact that the best result comes with the combination of the two research processes. Without getting access to big data, it will be really tough for retail traders to predict the trend. But the complete beginners can rely on the simple tools available in the trading platform. So chose your trading paltfrom very wisely so that you don’t have to take any wrong decision due to faulty tool.
Immaturity
FX platform looks so shiny to those amateurs who are new to buy the currency pairs. Experts never execute their trades whimsically as they know so many things are hidden behind the appealing visual representation of the graph. If he fails to decode the language of the chart, he may lose a great amount of wealth. You might be extremely skilled at trading but still you can’t break the rules. Breaking the rules at trading reflects your lack of knowledge at trading. You can trade like a king throughout the year but one bad decision can wipe out the hard earned profit. So, never take immature decision as it can make things very hard for your trading career.
To solve this issue, new traders should utilize the demo Forex account and execute trades for months. When he feels enough strength to trade using the real account, only then he should come to the battlefield. But you should never stop using the demo trading account since you can test different trading techniques. Demo account are blessings for the new investors. You may have less experience about this industry but if you can take advantage of the right tool and learn from your mistake, you can master the art of trading without risking any real money. Just because you are trading with the demo account doesn’t mean you will trade with less importance. Smart traders never take things lightly when analyzing the trade signals in learning paltform.
Rationality
Without having a rational mindset, it is really tough to find a great opportunity in the market place. Rookies should be aware of the fact that Forex trading is not gambling. Depending on the fate of trades operated, an investor may be far from the return of his investment. Your profit should be determined based on your investment size. If you invest a small amount of money, you should not be taking the trades with huge losing potential. The trade should be taken in such a way so that you don’t have to feel the pressure the recover the loss. Follow a safe approach so that you can withstand frequent losing trades. It will only possible when you will look for the trade signals in a rational way.
Rational thinking helps to make the best decisions regarding the improvement of the strategies. Expectations will work in reality when practical actions are taken based on deep thinking. Skimming the surface without studying deeply does not provide you with actual success in the long run.
To get real success, traders should invest some time in their trading research based on historical analysis. By analyzing the history of your previous trades, you can make the best decision by minimizing the number of mistakes you make.
At the bottom line, it becomes clear to us that what we expect always regarding the FX market is not always true. Beginners just see the outside appearance of the success of the successful investors, but they should measure the reality as well to be successful.