Reflections on Forex

Reflections on Forex

Once I wrote in this space about the Forex it is a way to speculate on the exchange rate between different currencies.

It has been said many times that the exchange market is the world’s largest and most liquid, but as I always said, you have to put things in context. This is mainly because we live in a globalized world and every day many companies and governments have to make payments in different currencies. Why such a large volume of foreign exchange transactions is generated every day.

Many people mistakenly believe that through the Forex can make easy money and with limited risks. This is not true. Although there are technical tools that can help us find certain patterns, the market is highly volatile and there are plenty of “false” signals. They need to be an expert on that and spend hours at the computer, identifying opportunities that are closed in hundredths of a second.

Can you make money in Forex? Yes but you can also lose a lot. This is because operating leveraged way – that is to invest USD $ 1000’re actually making a larger operation at least 100 times, that is, as if we were investing USD 100,000.

In this sense, if it is successful and our “bet” up 1%, we would be doubling our investment. But it could also be the opposite and we risk losing everything. There is no easy money in this world, yes you can earn a lot but you can also lose everything.

Some operators in the past have told me that this is not true, because you can place orders “stop loss” to protect us from this.

But you should know that not always run to our hotel “stop” because sometimes there are jumps in prices, then we can lose a lot more than we think. When it operated so as leveraged (100 to one that is common), a movement of only 0.1% in the exchange rate can make us lose 10% of our investment.

If you want to “bet” with these issues should only be done with money that we are willing to lose – that is, we have plenty of truth. We must also remember that there are no operators is regulated by ten Mexican financial authorities (possibly itself in other countries) so in case of a problem with the broker with whom we have our own, no one can help us.

So you have to know how to choose. There are also mobile applications that allow us to operate from the comfort of our cell phone, such as iForex platform among others.

I personally do not participate in this market because money does not spare me. In this space I have always tried to report on how important it is to invest with a long-term perspective.

But I know that not everyone is like me and there will be people who will want to try. Remember do in conscience, knowing what may happen, making an informed decision is the most important.

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