Find out why you shouldn't start trading Forex until you really know what you're doing.
As with any form gambling, you should never bet more than you can afford to lose. However, the Forex market is is particularly volatile and very difficult to forecast. This means that there are high risks associated with trading foreign currency.
Although longer term changes in foreign currencies tend to be gradual, currencies are sometimes subject to dramatic shifts over short periods of time.
It is this short-term volatility, combined with the fact that you trade on a margin, that exposes you to the very real risk that you could lose a lot more than you ever wanted to invest.
Although you can reduce your level of risk by using instruments like stop losses, diversifying your trades across a number of currencies and keeping your margins small, you need to be aware that Forex trading is a highly complex business and should not be undertaken lightly.
