FOREX can be EXTREMELY profitable if you come at it correctly. Here are some of the important Do’s and Don’ts of FOREX trading.
Do : Do make sure to keep a constant eye on your margin. If your available margin drops too low, your broker will make a margin call. If you don’t deposit money within 24 hours, they will sell your currency for the current market value, and you can take substantial losses.
Don’t : Don’t EVER invest more money than you can afford to lose. All over the internet are horror stories of people investing their life savings into programs. The best advice is to consider your income and your plans, and make sure that necessities are put first. Substantial losses are sometimes hard to recover.
Do : Do utilize stop/loss purchases. These decrease the likelihood of extreme losses. If used correctly, these techniques can actually increase your earnings because it will sell if it gets too high, but continue accumulating as it increases.
Don’t : Don’t make too many transactions at a time if you plan on carefully watching each currencies movement. Multiple transactions cause problems when timing is as important as it is. Keep your purchases to a maximum of 2-3 at a time. This makes it much easier to buy and sell quickly.
Utilizing these simple do’s and don’ts can save you from a potential lifetime of problems. Just make sure to take care with your spending and use common sense when dealing with money.
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This post was written by admin on September 15, 2008
