Top 5 Misconceptions about Forex

[SamForexTrader]

I would like to present top 5 misconceptions about Forex that I have encountered with:

1. Forex trading is quite easy
Actually Forex trading market should be closely studied

2. There is a Forex company
There is no such company. Forex is realized through brokerage companies.

3. Commission is to be paid to brokerage companies
The profit of companies come from spreads, the price difference between
buy and sell.

4. “I need to have a great amount of money in order to start trading in Fx
market"
Leverage ratio gives you an opportunity to trade with more money than
you actually have.
5. “I want to exactly predict in what direction the market will move”
The market movements can never be predicted with 100% certainty.

 

[MonsterTrader]

Re: 3. Commission is to be paid to brokerage companies

I would like to add that brokers make money from the spread AND from betting against the common trader.

Brokers act like normal bookies most of the time. You place a bet that price will fall or rise and the broker takes that bet. It is no secrect that most people lose all there money when they try to trade forex and it is the broker who wins all that money!!

 

[SamForexTrader]

Re: 3. Commission is to be paid to brokerage companies

I would like to add that brokers make money from the spread AND from betting against the common trader.

Brokers act like normal bookies most of the time. You place a bet that price will fall or rise and the broker takes that bet. It is no secrect that most people lose all there money when they try to trade forex and it is the broker who wins all that money!!

Yes, and most brokers hide that fact from clients. It seems to traders that their lost money goes to national banks.