Risks and Trading Ways to Minimize Losses

Simply put, trading is an activity that refers to the act of buying and selling in the capital market in a short time to get a large profit. One of the trading activities that people often know about is forex or foreign exchange trading.

The profit gained from this activity comes from the difference between the selling price and the purchase price where traders must carefully determine when to buy currency when the price is low and sell it when the price is high. However, behind the large profits there is also a risk that traders must know, what is that risk?

Trading Risk

Generally the risks associated with trading take the form of gap risks, poor execution and slippage. The risk of the gap is the time when the appearance of a break in the trade.

The risk of poor execution occurs when a trader or broker encounters problems during trading activities. While the risk of slippage involves hidden fees on each transaction.

Market Risk

Market risk is a situation where traders cannot control the situation because these factors come from external sources, such as inflation risk, stock price movements, foreign exchange rates, commodity prices, and interest rates.

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