Top 5 myths about Forex trading
Most traders just see the word Forex as an opportunity to make fast money with little or no effort involved.
Novice traders don’t understand the concept of risk vs reward and how they can turn $5k into $50k using one strategy. With no prior knowledge in finance, it’s like chasing a dream you will never grasp.
That’s why people get scammed out of thousands of dollars every day; because these “traders” are using the proper education, but they don’t know how to put it into practice.
Here is one example of an education scam; A forex robot that will allegedly make you $21,599 in just seven days. It’s mostly impossible to achieve and an utter scam!
You can’t just buy something online and hope for the best because if there were an easy way to do anything in this world, then everyone would have it. Be vigilant and do not fall victim to scams.
Many misconceptions are circulating about forex trading, so let’s take a moment to consider the five most common myths. Then we’ll look at why these myths occur and what you can do to avoid them.
#1 Give up hope when it gets difficult
The best way to reduce this myth from hindering your potential is to make sure you trade with a plan. This means opening an account, practising trading, understanding the process before you trade with real money, researching products and services that can help you grow your knowledge base and reading as much as possible about successful traders.
#2 The Forex market is a gold mine – I can easily withdraw my profits
Reality: Be prepared for a few bumps in the road. Many people assume that a profitable trade will always lead to an easy withdrawal of those profits. It is not a realistic expectation, unfortunately.
#3 All trading systems are profitable.
Reality: When you read about the Forex market, you’ll quickly discover many ideas and opinions behind why specific strategies or technical indicators work better for some traders than others.
Unfortunately, many of these theories don’t offer sufficient proof to back them up because no one can test their validity in a real-world setting where all variables are accounted for perfectly.
Only time will determine if the system you’re using is effective.
#4 I have to be extremely intelligent to trade successfully in Forex
Reality: The best forex traders have strong backgrounds in finance, but they also possess qualities like patience, perseverance and discipline.
If you can manage your emotions, you will be well on your way to making sound decisions no matter what the market is doing.
#5 Trading is a full-time job
Reality: You can trade Forex successfully as an extra source of income or even as your only job. Many day traders and scalpers make significant profits by trading for just a few hours each day, and they do this during traditional 9 to 5 work hours.
If you don’t feel like this type of lifestyle appeals to you, but you’d still like to make money with Forex, consider starting part-time while keeping your current job.
Over time, if your results are promising, consider moving toward full-time trading once you have enough capital to do so.
The bottom line
Forex can be a very lucrative line of work, but it’s not the get-rich-quick scheme many people make it out to be. You’ll encounter your share of pitfalls and challenges before you see results that put money in your pocket.
It all starts by understanding these five most common myths about Forex trading and then planning accordingly for what lies ahead.
Like everything in life, successful forex trading depends on patience, knowledge and hard work.