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Arnaude Patel

5 Common Mistakes Young Forex Investors Make

You should learn a new skill when you are young. Same is true for investing.When you are learning something new, you will make mistakes. In the case of money, when you are young you have the time to recover from any mistake you made in investing. Still, you may lose a lot of money ad find it challenging to recover. These are some mistakes made by the young forex investors.

Delaying decisions

The forex market moves very quickly. After doing good research, investment ideas come up. If you don’t act quickly, then other’s will take the opportunity. Sometimes, the young investors don’t act on a good idea out of fear. After they realize that they had made a mistake, they may look for a replacement to compensate for the missing opportunity. They may buy another asset quickly without doing research.

Guessing instead of investing

A young investor can get bigger returns by taking more risks. This is true as the young investor has the time to recover his or her lost money through income generation. They often guess things in investment without understanding the concepts or processes in details. Guessing in forex investment is like gambling and it is dangerous. So, young forex investors need to understand the process in detail and not guess or speculate anything.

Using too much leverage


Having too much leverage can destroy a good portfolio. If there are many drops in the investor’s portfolio, then the investor may become discouraged, and it will affect the rest of his or her investing life.

They should know the reason behind price drops

When the price drops, there must be a reason behind it. The young investors often don’t want to know why such thing happened. Whenever there is a drop in price, the investor needs to research and find out the reason. This way they won’t make similar mistakes again.

They look at present benefits that money can give them


Young investors can take greater risks and get higher returns if they invest more money. But they tend to develop the habit of spending money instead. They don’t think about long-term savings. In the end, they have a lack of savings.

Young investors should invest more money in the forex market and try to get more returns. They should learn about the forex investment and gain experience so that they can invest wisely. They have much time ahead of them, so they must not be afraid to take the risk. They should start investing while they are on their full-time job. This will help to minimize their fear of losing money.

5 Types of Forex Traders Present in The Market

The forex trading strategy you will adopt depends on the type of trader you are. Knowing which type of trader you are will help to get rid of your fear and have more faith. Here are the 5 types of forex traders in the market.

Scalpers

They can also be called guerrilla traders. They get inside the market many times a day. They open each position for a few seconds. They spend most of their time finding trend changes on the charts. They can make snap decisions for getting more profit when the trend changes. They are fast-paced and often use software to execute trades.

Day traders


Day traders don’t like holding open positions overnight. They open a position at the beginning of a trading day and close it at the end of the day. They only care about opening and closing their positions, and not so much about profit or loss. They rely on trading news to make decisions. They can spot breakouts instantly.

Swing traders

This kind of traders keeps positions open for more than a day but not more than a week. This type of trading is appropriate for those who struggle to balance forex trading with their daytime jobs. They have larger profit targets. They don’t worry about forex spreads very much. They can trade currencies with higher spreads.

Position traders

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They are the opposite of scalpers. They can keep a position open for weeks and even longer. They can spot trades that lead to long term profits. They have large trading accounts that help them to withstand losses they make.

Mechanical traders

They don’t worry about time frames. They are beginners in this market. They know some specific technical indicators that they have tested before. They code their strategies in the forex trading software.

The personality of the trader plays an important role in determining the strategy of forex trading. Personality traits like impatience, risk-taker, etc. dictate which strategy would be best for you. The forex trading strategy that you choose should fit your lifestyle and personality.

Top 4 Reasons Why You Should Buy Mutual Funds

Investing in mutual funds is a good decision. It can give you good returns. Here are the main benefits of investing in mutual funds.

Diversification

Once you buy a mutual fund, your money is mixed with the money of other investors. This lets you buy part of a pool of investments. This type of fund holds different investments. So, investors can diversify their choice. Having a variety of investments helps to lower the impact of poor performance. It also takes advantage of the earning potential of the other investors.

Professional management

The portfolio manager is responsible for taking the decisions. He or she decides where to invest the money when to buy and sell the investments. This is a good thing as you may not have the knowledge, skills, and time to manage your investments.

Easy to sell and buy

You can get mutual funds in banks, investment firms, trust companies, credit unions, etc. You can sell them easily any time you need money by compromising a little on the quality.

military_saves_week_service_members_encouraged_to_take_charge_of_personal_finances_140117-f-it851-042Huge selection of firms to choose from

Mutual funds can be used to meet various financial goals. For example, a person who has a stable income and can take risk will invest in an equity fund. If someone ones to take less risk, that person can invest in a balanced mutual fund. The safest option is the bond fund.

By investing in a mutual fund, you can expect high returns. But you also should be prepared for loss. So, choose a reputable investment firm so that your mutual funds are in safe hands.