Forex is too risky, so why you still doing trading?

[The Sniper]

I do not understand from where this forex being risky comes.
I think ppl do not understand the basics of finance.

Leverage is risky not forex or trading.

Every investment with high leverage is risky.It can be gold/silver,real estate,cattle,house or trading.
Basics of leverage is how much money you put upfront and how much money you borrow to make an investment.

Say,you want buy a flat in Mumbai worth 2 Cr as an investment hoping the rate will go up to 6Cr in 3 years.But you have only 50 Lakhs money with you.So,you talk to a Banker friend who will lend you rest of 1.5Cr in return of modest return of 10%(just assume).
Suppose after end of the 3 yrs you are right and property is worth 6 crores. Out of the 4 crore profit you will pay back 2 Cr( 1.5cr principal and 0.5 Cr interest) and keep the rest of 2 Crore with you.

So,you invested 50 lakh and got 2.5Cr.

In the other case say property price comes down by 20 Lakhs due to economic slow down. But,you have to pay the loan back to the bank anyway after 3 years.
After paying interest of 0.5 Cr interest + loan 1.5 Cr,you are left with 1.8Cr-1.5Cr-0.5= -20 Lakh

Net 70 lakh loss.


Remove the interest component and apply the same to forex or any kind of option/futures trading with leverage.(Actually there is interest component in forex called SWAP)

Leverage magnifies gain/loss.
Forex,Futures,commodity even stocks options (Call/put) have high leverage has same degree of risk.
Forex is not different from any other kinds of investment as such.

Only thing is forex brokers allow kids to play(over leverage) with 10$ which others might not allow

http://en.wikipedia.org/wiki/Leverage_%28finance%29

http://www.investopedia.com/terms/l/leverage.asp
to invest with you.You deal with bank says

Forex is risky to whom who do not know much forex. it is easy for merchants of good. I think all people come on forex make money for myself. So the first time you think it's too risky to enter this profession. but when you have found a way to win it will be like playing pc games. because it is a business and no business is easy thats why most people say that Forex is too risky.

[shozeb]

Forex market is risky for those traders who do not follow forex basics and keep on trading.Traders should follow proper technical as well as fundamental techniques before entering in this market. Apart from this, its always advisable to take guidance from experienced traders. If you follow these points, you will manage to earn good from this market. Thanks for all.

yeah sahi kaha dude mere khayal se unn newbie trader k liye hai jinhe zyada knwldge nahi hai trading ki aur woh isey asan business samajh kar isme agaye hai aise traders ko bahot loss face karna padta hai.....

[Isafan87]

Everyone always says that forex is risky. Is it that risky? If it is, why are we still out here trading in this risky market. What you think about this?

From my point of view, forex trade is risky. But every business and trade have risk. I'm like addicted to forex trading once I joined it since 2 and a half years later. For me anything to do with money is risky. Thus every business shall not be take for granted. Money is at stake.

[rashed_12]

yes, i am agree with this post that forex trading is so risky but if you trade with much analysis it will not so risky on the other hand if you are eligible for analyse in forex market it will be so risky.thanks

[houdanahamdan]

The forex course is very serious, but we can succeed where given to us that Alchrotaulha to be fully aware of the market and its mechanisms and how to move and not to use the robot and not greed and calm the nerves and not to rush so as not to destroy ourselves really !!!

[moshiurmmrs001]

"Forex is too risky?" I don't agree with this. I think it is very helpful to the ones who knows how to deal with this , how to take the benefit out of it. Although it is little bit risky but the good aspects of it are many. So i have decided to trade with it.

[ontorip]

Emotion is a factor that is giving great impact to the trader. A trader must learn how to control their emotions to avoid losses, including increased.no pain no gain...

[wahidaaa]

In my opinion there are many more risky things in the world are we are doing these like flying the air craft,driving the moto GP cars etc and the forex is mush less riskier then these all things so it is the sole reason that most of the people are still trading.the best thing for consistent earning in the forex is through a proper money management plan and risk management as well.

[maheshputta]

i fully agree forex is 100% risk but people like me are still doing because of it quick profit many of them made more money and many of them like me lost money in that. good timing with good training will make profit in forex trade . if we can analysis we can make good profit and reduce the risk in that.

[prothom.ses]

every trading business has risk but we should take it carefully. forex has lot of opportunity for earning money. so i try to do job with forex and i like there trading system.