How Does DotBig Broker Help Traders Minimize Risks in Forex Trading?

Currency trading is risky, especially if you do not know what you are doing. Aggressive use of borrowed funds, emotional decision-making, and ignorance of world economic affairs make Forex trading a hard, unsuccessful activity.

With a reliable broker, you can minimize risks and earn money on Forex transactions right today. Next, you will learn how DotBig exchange helps clients minimize negative trading scenarios and earn profits despite risks.

How to Choose Assets for Trading Online?

Recessions and periods of turbulence in financial markets are an integral, almost inevitable part of trading. After all, economic shocks and a downturn in financial markets can have an impact not only on their investments but also on other asset classes.

It is possible to recognize a safe protective asset by the following signs:

• The market offers are quite limited. The demand for safe assets never exceeds the supply.
• High liquidity. A safe asset can be quickly sold if necessary by converting it into cash.
• Volatility (the rate at which the price of an asset increases or decreases). It is better to choose assets with moderate volatility, as it is easier to predict the change in their quotes.
• Stability. Another crucial point demonstrates that the demand for the asset will not disappear in the coming decades.
• Availability of information about an asset. A large amount of relevant information in the public domain makes it easier to predict asset quotes.

Over time, a trader can swap one safe asset for another. However, before choosing a safe asset, monitor current trends in the financial market. Fortunately, the DotBig broker provides clients with all the necessary information about current market trends.

Beginners in trading are not recommended to choose high-risk assets such as binary options. It is also worth avoiding difficult-to-predict instruments that have increased exchange rate volatility or a vague growth prospect. Such assets include shares of new companies, exotic currency pairs, cryptocurrencies with short-term price spikes, and sharp drops in quotations.

DotBig Risk Reduction

Online trading is a risky activity. Thus, it is crucial to use risk management tools when working in the Forex market. Fortunately, the DotBig trading platform provides all the necessary stuff for running trading deals in a low-risk environment.

The company offers risk-management tools for its clients. Although this is not an absolute guarantee against trading risks, the risk-management tools bring a certain effect on the favorable outcome of operations in the global market.

Stop-Loss

These orders automatically close the deal if the market moves against you by the specified amount, limiting potential losses. Thus, online traders can use stop losses to reduce financial risks or lock in profits on an existing position.

Stop-Loss orders come with instructions to close a position by buying or selling a particular asset when it reaches a certain price, known as the stop price. They differ from Stop-Limit orders, which are orders to buy or sell at a certain price since the value of an asset reaches a certain stop price. Stop-Limits may not be executed, while Stop-Loss will always be executed.

Just a simple example, a trader buys a stock and places a Stop-Loss order with a stop price 10% lower than the purchase price of the stock. Some time passes, the asset price drops to the set level of 10% and a Stop-Loss is triggered immediately. Thus, the shares are sold at the optimal price for the trader.

Take-Profit

To trade successfully one needs to manage the risks, but it is difficult to perform in real-time constantly monitoring the exchange case. Using technical analysis, traders view the cost growth of a particular asset to take advantage of this potential in the future.

Thus, traders use Take-Profit orders to capture potential profits on the DotBig site. They allow them to trade an asset since its price reaches the desired level (for example, based on previous analysis). Although the price may not reach their chosen level, such a fixation allows you to make a profit that traders could have missed.

Trailing Stops

A trailing Stop is a regular stop order that can be placed at a certain percentage or dollar distance from the current market price of a security. For a long position, the market participant sets a Trailing Stop below the current market rate. For a short position, it is higher than the market price.

This order protects profits by allowing one to keep a trade open and make a profit while the price is moving in favor of the dealer. The order closes the transaction if the price changes direction by a specified percentage or amount in dollars.

Besides, to reduce risks, the DotBig investments platform offers diversification of investments across different asset classes to reduce risk. Remember that before investing, you should carefully assess the risks and, possibly, consult with a financial expert.

DotBig for Novice and Experienced Traders

Regardless of the asset choice, DotBig Forex broker provides traders with favorable and comfortable conditions. It sets low floating spreads, which start from 0.1 points on a standard account. Low trading fees allow traders to earn higher profits.

Basic technical indicators and protective orders are available to novice traders to minimize risks. According to DotBig reviews, the exchange provides traders with analytical materials, forecasts, and news updates, which greatly facilitates forecasting asset prices. For novice traders, DotBig supports clients at all stages of cooperation, from registration to asset selection and transaction completion.