What awaits a newbie on Forex.

Most people unfamiliar with how the exchange operates have a far from idealized understanding of forex.

This is due to an incorrect approach to trading and the common mistakes made by novice traders themselves.

With proper trading organization, you can minimize the risk of losses, and this isn't as difficult as it might seem. Here

are the main risks in forex and how to reduce them.

1. Mistakes in broker selection can lead to slippage and unexpected spread widening, which can significantly worsen trading results, not to mention direct broker intervention.

It is recommended to work only with ECN brokers that use a non-dealing desk system. Examples of such companies are provided in the article " ECN Brokers ."

2. Excessive leverage: Margin trading is the cause of large losses or completely lost deposits. In the US, for example, there are strict restrictions on the use of margin trading.

Beginners are advised not to open trades with a volume greater than 10 times their deposit. If possible, it's best to avoid leverage altogether at first; this will preserve your money and allow you to better understand the market.

3. Deposit loss : a complete loss of funds in the account as a result of a trend moving against an open position.

If you follow the previous recommendation, you're unlikely to encounter this phenomenon. If your strategy does involve high leverage, the primary means of preventing deposit losses is a stop loss .

4. Losses due to incorrectly entered trades: Most trades are unprofitable, which gradually leads to a complete loss of the deposit.

To solve this problem, avoid spontaneous trades, use third-party analytics, and use market entry

signals When entering Forex, don't try to make huge profits right away—only a few out of thousands have succeeded. Make trading your full-time job and gradually increase your deposit while honing your trading skills.