Forex : Advice 5

Another major mistake done by Forex traders is to overtrade their Forex account, failing to measure the risk their margin can absorb. Positions taken always surpasses what the margin deposited can undertake. Margin trading is actually a two-sided sharp blade sword.

Most often, Forex traders only need USD1000 to hold a USD100,000 position, but it doesn't mean that an account with USD5000 must hold up USD500,000 position. Treat a USD100,000 position as USD100,000, not just USD1000.

An experience principle is, not to use more than 10% of the margin in trading Forex.