Misconceptions about forex trading are widespread and can prevent you from achieving sustainable success in trading.

Foreign exchange trading, for which the term "Forex trading" (Foreign Exchange Trading) is also widely used, enjoys great popularity among private investors. However, many underestimate the risks associated with this highly speculative trading. In addition, there are many misconceptions about the laws that govern the foreign exchange market.

Forex trading is possible only during the opening hours of the stock exchange

Unlike stock trading, this restriction does not exist in forex trading. Forex trading with foreign exchange takes place around the clock from Sunday night to Friday at midnight. Since the trading is fully automated via computer systems, you can conclude trading contracts at any time without any restrictions.

It does not matter with which broker clients trade

This is not the case. The individual providers differ in terms of essential service components, such as the trading platform used, the tradable underlying assets or currencies in https://exnesscom.com/cryptocurrencies-trading/, the availability of demo accounts, the minimum deposit and, above all, with regard to the costs incurred during trading.

There is no deposit insurance for Forex trading

The balance on an investor's trading account is often protected by the broker's membership in a deposit insurance institution. The level of this depends, among other things, on the broker's headquarters. In all EU member states, brokers are required to maintain membership in a deposit insurance association. However, the amount up to which customers' funds are protected varies from country to country and depending on optional additional safeguards. In addition, experienced traders attach great importance to the fact that the supervision and regulation of the broker is carried out by a well-known and reliable authority, such as the German BaFin or the British FCA. In relevant Internet forums, customers can inform themselves about the reliability and the type of regulatory control in the respective country.

Stop-loss orders are superfluous

The opposite is true. Through the targeted use of stop-loss orders, you can significantly reduce the risk associated with forex trading. These orders come into play as soon as your losses exceed the limit you have set. In this way, you reliably limit your maximum risk of loss. Even experienced professionals regularly use stop loss limits in their trades.

Foreign exchange transactions can be concluded across all currencies

Basically, experts distinguish between majors and minors. Majors are the most important currencies, such as the US dollar, the euro and the yen. Minors, on the other hand, are more exotic currencies, such as the Russian ruble or the Korean won. However, the selection of tradable minors is limited and differs from broker to broker.