Errors when investing in Forex

Some errors when investing in forex or invest in other markets are very difficult to avoid if you have no prior knowledge about the market in which to invest.

In the following lines we will expose some of the most common investing in forex by novice traders or people who approach this market with erroneous expectations errors.

1. not give enough importance to training
One of the biggest mistakes novice traders is underestimating the difficulty of investing in the forex market.

You have to understand that in this market involved investors and financial institutions have in their templates with extremely trained professionals and that move millions in a single operation.

When you start investing real money you have to think that you are investing against them, and therefore must have training and market knowledge solid enough to not risk your capital recklessly.

2nd. Start investing with false expectations


Many of the people who start to invest in the currency market do it with false expectations.

In those expectations are ideas like that is not necessary prior knowledge to win, or you can live by trading with little capital thanks to the high leverage that allow different Forex brokers.

All these erroneous expectations and many more that have omitted to do too heavy item are to blame for many traders lose their capital during his first months as investors in this market.

3rd. Forex trading with excessive leverage
Forex leverage can agree that is a very useful and even indispensable tool. However, it must be said that its misuse could cause very heavy losses.

One of the arguments that encourage market entry on leveraged, is to think of the high profits will be achieved if the market moves in your favor, but often do not take into account the reverse option that the market moves against you.

We must be aware that however you can be sure of an analysis you've done, you can be wrong and one error if these over-leveraged would be devastating to your account.

4th. Do not use Stop Loss

The Forex market is known for its high volatility, and that's why we have to keep in mind that the use of Stop Loss is very necessary to limit losses as much as possible.


You can see yourself in the situation you open an operation and within seconds the market does not stop moving against you for some news for example. In such situations, have a Stop Loss order placed will prevent losses increase and increase and allow you to limit the risk that you take when operating in such a volatile market.

5th. not give enough importance to capital management

Almost all traders starting usually pay more attention to the money they want, want or expect to win, to maintain and not lose the capital to start.

You have to think that your capital is your best tool to make more money and therefore have to devote part of your efforts to learn how to manage it the right way.

6th. not stop change and change the trading system

This error traders make sound already investing in Forex carry a time, but not just get good results with the type of trading they do.

In this case traders change and change system hoping to find an indicator or a way of operating that never fails and you unlimited benefits.

We must avoid falling into this type of behavior and try to figure out what kind of trading you feel more comfortable and specialize in it.

7th.Indulging misleading advertising of some Forex brokers

This error is one of the most affecting investors who start with very little capital and little or no training.

Unfortunately many brokers, using unfair behavior with a potential client, do advertising campaigns implying that a solid formation to invest in Forex or you can live by trading with 1,000 euros is required.

We must avoid being carried away by this type of advertising message even avoid having any business relationship with brokers who use this type of advertising to get customers.

Many of the envelopes mistakes that we talked about earlier are committed by the inexperience of traders who are just starting.

It is true that it is very difficult to avoid them all because we are not aware of many of them until we make, but if we use common sense and devote enough effort to training, sure get avoid some of them.