Are you aware of the risk factors? 

If you are not careful about the risk factors of currency trades, you will lose lots of money. You need to have a decent idea of how to reduce potential losses. The risk factors are the major catalysts that influence the potential losses. You need to improve the trading edge to improve the profit potential. Before that, a trader must ensure his or her investment is safe from potential losses. For a rookie trader in Hong Kong, the losing potential is very high. It is important to secure any trading plan for the safety of the investment. The first thing you need to do is invest a low amount of money in the trades. Then you will also need to establish a solid trading edge which can improve the trading efficiency. Therefore, you will have a decent chance of managing profits from the trades.

Apart from the risk exposure, there are many other things which can help you reduce risk factors. You only need to follow some valid plans for a secure trading performance. In this article, we will be discussing the important aspects of a safe trading process.

You should use stop-loss

To secure the risk exposure from big potential losses, a trader needs to use a stop-loss. This is the system which can help you close a loser before making big losses. The idea is to select a position where you can set the stop-loss. Then using the trading platform, you need to set the stop-loss for each trade. Therefore, you will have a decent chance of saving your investment. But without having solid market analysis skills, no trader can set the stop-loss properly. You must understand the market conditions. Moreover, you must have the ability to find a suitable support or resistance point for the stop-loss. For this reason, efficient technical analysis is very important.

If you can plan the Forex trading process in a right way, you will not experience big potential losses. Instead, you can manage a quality trading execution for each trade. Therefore, you can also experience decent profit potentials from the trades.

Reduce the risk exposures

As mentioned at the beginning of this article, risk exposure is highly influential for the risk factors of the trades. When you will increase the risk exposure, it can lose a significant amount of money. The return of the trades depends on the positioning system. Therefore, you will have a good chance of losing investment at the beginning of your trading career. So, every trade coming out of your account should have decent risk exposure. Expert traders follow a decent risk per trade strategy. With a 1% or 2% risk per trade strategy, they invest in the trades. Alongside the investment, they also leverage the lots but no by a significant margin. The most common ratio for rookie traders should be 1:10. If you can follow this idea for your trades, you can easily ensure a solid trading performance. Therefore, you will also have a decent chance of experiencing profit margins from the start of your career.

Target low-profit margins

A rookie trader must secure their trading business with risk to reward ratio. So, it is important to set the profit target for the trades. If you want to execute a winner, a risk to reward ratio is important. For the safety of the trading capital, every trader must use a decent profit target. It helps to keep decent control over the trading edge. You can also control your emotions in the trading business. As low-profit potentials will not excite you too much, you will not try to increase the risk exposure for the trades. Therefore, you will have a low-risk factor for the trades. So, follow a decent risk to reward ratio to find valuable trade setups. So, trade with low interest in the profit margins.