Fed Records Show Borrowing by Some Foreign Banks
April 6, 2011 by admin
Filed under Forex Featured
Mar 31 2011 Bloomberg — The Federal Reserve released thousands of pages of secret loan documents under court order, almost three years after Bloomberg LP first requested details of the central bank’s unprecedented support to banks during the financial crisis. Erik Schatzker and Margaret Brennan report on Bloomberg Television’s “InBusiness.”
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Duration : 0:4:16
Avoiding the Pitfalls in Currency Trading
February 24, 2009 by admin
Filed under Forex General
Avoiding the Pitfalls in Currency Trading
There are many pitfalls to be avoided when trading.
The first pitfall is to believe that every trade must be a winner. This isn’t true and will get you into trouble. It is fine to take losses on trades that are not going in the right direction. However, a trader with a must-win mentality who think that the trade must be converted into a win will hold onto a bad situation only to make it worse. It’s fine to let it go and get on with it. That way the next trade can be set up and readied. Holding on to a bad trade usually just ends up in bigger losses. Good traders know that even a system that only generates 60% positive trades can be very profitable if used in the right way.
Another pitfall is to believe that you must always be in the market. If you are basing a lot of your financial hopes on trading, there is a temptation to be constantly making trades and making profits. Instead of waiting it out for the ideal situation that will bring on the highest chances of success, these overactive traders feel that if they are on the sidelines then they are missing out on the action. Remember that even the best pro-athletes sit on the sidelines sometimes. That is because there are times when it is best for them not to be in the game. Traders who become overactive are likely to fumble and make poor trades just because they can’t stand being out of the market waiting until the next golden opportunity pops up.
As a trader, you also must be wary of "revenge trading". Revenge trading happens when things have been going well for some time and an unexpected loss occurs. Instead of taking the loss in stride and hoping to make it back later, the trader lets emotion overcome them. The stakes are just doubled and a new position is taken out. The mentality goes something like, "If I lost 10%, then I can double my investment and if it goes up 5% I will make it back". This is not a wise manner of thinking. What would be better is to take the losses, sit back and look for the next good trade. Revenge trading can be very dangerous, especially if it puts you into a highly leveraged situation where you could lose it all.
And that brings us to the last pitfall. Just because a broker offers 400 times leverage doesn’t mean that you should be borrowing that much money. Remember that the more leveraged you are, the easier it is to lose it all. So watch your leverage at all times and make sure that any leveraged trading is part of your strategy and not due to emotion.
Watching out for these pitfalls will help you stay in the black.
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