1. Determining Between Risk And A Scam In Forex Trading
There are certain elements beyond the riskiness of currency fluctuations that render individual Forex
trading difficult. Consider the tips below to determine whether your losses are from risk or are the
result of a scam involved in Forex trading.
If the software you use fails, then your trades can fail to go through or you aren't able to trade. This is
usually a risk of Forex trading as much as the use of other software for your online accounts. If the
software isn't working, you cannot execute trades on your account. Most platforms include
assurances of how they have backup systems and other steps that are taken to prevent software
problems but investors bear the risk of system failures.
If you are being charged fees that you did not read about, then you might be being scammed. Before
you open an account read about that account. Ask specific questions, such as whether the account is
charged inactivity fees or additional fees for scalping activity which is the opposite end of account
activity where you have many trades. Further questions could involve whether you will be charged in
any way for using the trading platform software or its updates. You can also ask the general question
about where in the documentation is a list of fees charged by your Forex trader.
One of the complaints by Forex traders are that they earned money in the demo Forex trading
exercises but have lost money ever since they began working their own account. This is frequently a
risk and not a scam because as most demo accounts will indicate, the demonstration uses past data.
Deriving models from past data is not always helpful in terms of the predictive ability of a model.
If you borrow money on margin for Forex make sure you understand position liquidation policies,
these are usually a risk rather than a scam. If the amounts you have fall below margin requirements,
Forex accounts frequently sell your losing positions and take the money out of your margin account.
This means that you can lose your money rapidly if you don't watch to make sure that your losses
don't fall below margin requirement levels.
Most Forex transactions do not charge a commission per se. While advertisements claiming no
commissions are technically accurate, this claim is really a bit of a scam because Forex traders and
brokers are making money on the spread. These amounts can vary from trader to trader and can add

2. up to significant costs for Forex traders. The amount of the spread is the piece of information an
investor is looking for to determine how much money the dealer is making on the transaction.
Individuals looking to invest in Forex must be very aware of what Internet site you are using for advice
or to set up an account. Other countries have different rules applying to their Forex traders such as
whether certain forms of investment protections are available such as Forex trusts. While these sites
may not be scams, some of them may be designed to get your personal information. Research
whether a specific program or advertised service is available in your country before providing
information to a person or company that will handle the transaction for you.
If you are guaranteed a positive return in your Forex trading it is likely a scam. While this may seem
like a no-brainer, there are still advertisers and merchants guaranteeing positive results. This is not
possible, especially in Forex where individual investors take on more risk than they do with other
types of investments.
Investment strategy advice is opinion and therefore is not a scam but a risk that Forex investors face
if they follow specific advice. It's difficult sometimes to distinguish between fact and opinion as
presented by those providing information about Forex. However, when it comes to trying different
strategies, consider all provided data as opinion. People frequently swear by a specific strategy or
system that will not work for you in your Forex trading.
Check the registration status of all individuals or entities you are dealing with when it comes to Forex
trading. In the US, the CFTC has instituted new categories of individuals and entities who must
register in order to engage in Forex trading. Basically, individuals involved in Forex trading in every
capacity must be registered although you can more specifically determine who is required to register
by going to the CFTC website.
Forex trading often results in losses. Use the tips below to help determine whether you took a risk
and lost or whether you've been scammed.
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