Forex encyclopedia

Within the framework of regulations of the USA financial markets, NFA primarily implements the function of control over proper compliance of organization members with the Federal laws as well as standards set CFTC. To cope with fraud and various abuse against stock and Forex brokers, NFA takes a number of measures first of all including supervision over implementation of clear-cut rules regarding advertising, public notification about risk, satisfying requirements to capital of company and competence of employees. Speaking about specific measures, we can distinguish the following...
We always hear people saying to control our emotions and trade carefully but we never understand them until we realize what they mean in fact. Below we will discuss this issue in details. Consider an example where we know how emotions lead you to lose: Suppose you have $500 of capital and you are trading. You took a high risk and thus you have lost $200. What finally remained is $300, you get frustrated and open again with an even more risky trade. Again you lose and come to $100. By following the same pace, you will end with zero balance. Let's analyze. You started with capital of $500 and lost $200 with $300 remaining. Your intention is to recover losses immediately and this is what we call an emotion. You have only thought of recovering money and you do not even think whether that situation is suitable for opening a trade or not.
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Forex encyclopedia
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