Most common things every naïve trader gets to hear?
If you think about how people were made to accept the shape of the earth, you will not be surprised to hear all the misconceptions about Forex. Only after Columbus proved, people understood what earth actually looked like. Likewise, the Forex misconceptions need to be proved wrong if not beginners will always become fools. They will end up losing just because of these common misconceptions. If the pro traders in Australia managed to find their place in the world, you are not anything else. You can also find your place in the trading world, but for that, you need to stop believing the misconceptions. It is easy to fool beginners because nowadays, almost everyone who enters the Forex market is clueless about the market. They don’t know the reason why they are trading and how they should trade. Thus, it is an easy task to fool the new entrants. But let us help you with the common things that you are made to believe. Once you read these misconceptions, you will understand why you shouldn’t listen to them.
You can increase the profit
If you trade well, you can double the profit. But that doesn’t mean you can do it in a day or two, and you can’t! Not only in trading, but in anything else. You can’t gain success overnight. For example, people enter the real estate industry intending to make money but does that they can earn in a short time? Nothing works that simply, therefore you need to accept the truth. You should accept that you can’t increase the profit without working hard. The way beginners have been fooled is quite fascinating because they are made to believe that Forex is easy money. But then, don’t think Forex is complicated. It is not complicated. Instead, it requires hard work to make money
You need to use a complicated trading system
The novice traders often get advice from other naïve traders! This might be sound interesting but it’s a very common problem in the CFD trading profession. No one has the potential to filter quality trades with 100% accuracy. Trading is all about finding the best possible trades with managed risk. So, if you rely on other people opinion, it won’t take much time to blow up the trading account. Try to remember, trading is just a business. So, craft a simple strategy so that you can make a profit at any market condition. Forget about the complicated trading system since success lies in a simple approach. Think twice before you follow another novice trader’s advice.
Use the leverage as you need
Leverage is a backup plan for you, but there are instances when the backup plans might be a threat itself. You should use the leverage when needed, but overleveraging will cost your trading position. You might have to quit trading entirely. This is why you need to understand this misconception clearly. Even though you are made to believe that leveraging is helpful, it doesn’t come without risks. You should be wise enough to use leverage when you need to, not whenever you can.
Broker’s bonus benefit
You think that brokers who offer bonuses are great, isn’t it? But it is not true because this is just like leveraging. It is a two-way thing. Just think, in this day and age, who will be ready to give their hard-earned money for free? The broker’s business depends on the trades you make. Therefore, brokers will encourage you. However, it is important to protect yourself from the overtrading disease.
It is not possible to include all the misconceptions in one article. Even though we have discussed a few misconceptions, they are not the only ones. You might come across a lot more when you go deep into the Forex world. At least, if you learn about the above misconceptions, you will be able to recognize others.