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Why people are losing money in Forex
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  3. Why people are losing money in Forex Why people are losing money in Forex

The main reason of losing money is because they do not understand the leverage.  This is a powerful and very dangerous advantage that you have while trading in Forex Market.

Thanks to the leverage you can trade in the forex market with few hundred dollars. Having such a low amount of dollars, the leverage will allow you to open positions which are as big as 100,000 dollars/euros. When you win with your trade you can make good amount of money. But if you lose then you can empty your budget very fast.

This is the main reason why all new traders should start trading with lower sizes such as micro lots or even nano lots. It is similar to stock market. It is bad practice to start investing in stock market and learn how to invest with real 100,000 dollars/euros. The risk is too big, in my opinion. It is easier ans safer to learn on smaller capital, it is the same with Forex Market as well.

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