Between Forex and Sports Trading
Are there common similarities between financial and sports markets if viewed at a glance? Certainly not. Yes, for most people it will conclude in this way, but if studied and understood more deeply by incorporating certain concepts, similarity is understandable, then what is that? Let’s take an example of the nature or character of a trader and boxer.
Where to start? Let’s start with theory! I am sure no one will argue that one’s success, both sportsmen and Forex traders is also determined by their level of insight. Indeed, these two sciences are different, and without the knowledge needed, success is unlikely to be achieved. For example, in boxing, boxers must have been given the knowledge of how to hit opponents, how to avoid attacks or how to do trickery etc. While in the world of Forex trading , this is about keeping currency pair movements, trading systems, money management and trading psychology.
So, the point referred to above is science. However, is it enough to only armed with theory? If a boxer fights in a ringwith only theory, then he will be easily defeated. As for the beginner trader who only learns trading with his theory, even by taking part in various video seminars, it will still be easy to lose money when starting a transaction at the terminal, whether it is instantaneous or after several attempts. In conclusion, both on Forex and boxing, both need a good theory, although this is not enough.
Then, what is the other approach? Is a practice. This is what most traders and novice boxers might underestimate. For a boxer, of course it is necessary to train his punch skills, then try to practice match in the ring . Experiments to compete with opponents are also very necessary, though only for a few times as a beginner. This boxing depiction can be used as an example, a trader must be able to apply their trading knowledge in practice. The trading system must be structured with a clear strategy, such as understanding entry and exit markets , working principles of Stop Loss orders, risks to transactions and so on. To practice the trading strategy, traders can use a demo account before stepping on the market with a real trading account. This is also intended to reduce the negative effects of excessive emotions — such as fear and greed — from an early age. Traders must also be able to complete hundreds of transactions on the strategy being tested, not just one or two transactions. Of course this requires a lot of time. If you want to speed up this testing process, a trader can apply a strategy tester. This is not a real market, but at least traders can simulate it quite accurately, and the most important thing is to test and develop trading strategies more quickly.
Now we assume the boxer who has been practicing in the ring for a long time, or a trader on a demo account or examiner decides to try to fight in the real arena. In a condition that is fairly profitable, the trader succeeds in making profitable transactions, and automatically increases his capital. But unfortunately, traders immediately thought that he already knew a lot and could do it easily, even he felt the market seemed to submit to him. Likewise with the boxer, he successfully passed the fight brilliantly, and immediately imagined the Olympic gold belt in front of his eyes. Now both traders and boxers, both are far more confident. Trader increases the number of transactions, because he feels he has experience and understands the market conditions. While boxers increase the risk by removing protective equipment.
What next? The market situation has changed, including its surroundings. Traders who previously made profit must be willing to see their deposit balance shrink, but their desire to immediately win it back is very high, even though this actually speeds up the bankruptcy process. If the trader is right that way – does not control his high passions – then he will only see a large hole in his account. Likewise with the boxer, the battle is now not as easy as before. He underestimated his opponent, but instead knocked out, lying and not appearing in the next match.
What is it that makes them both fail? Even though they already know a lot and have experience, it still isn’t enough.Then, what else must be considered? Boxers have a coach who can tell him what to do, what to explore and what to train again. What about traders ? If you have a mentor, it will be very helpful. But if not, then ‘forced’ to clarify it and identify the cause independently. Then, applying a variety of new trading strategies, adjusting to each market behavior, analyzing and considering it repeatedly. It is important to be able to understand various kinds of changes from different perspectives. Because, views or opinions are still far from the actual word. Investing opinion into facts that will occur always leads to a loss and leads to failure. This applies both in trading and boxing.
If you want to achieve success, both in the world of sports and Forex, you certainly have to work hard, and that can take a short time. In addition, you also have to prepare psychologically that everything is at risk. Not everyone can do this job. Therefore, the number of successful champions and traders is not so much. Beyond that, if you can overcome your own weaknesses and understand them very well, then a boxer who completes hundreds of matches in the ringcan eventually become a champion too. Likewise, traders who have developed their own trading strategies, need to learn not only in completing transactions correctly, but also understanding how to manage the right time to transact, and resolve them without excessive emotion, thus the level of success in transacting will be far more high.
So, the right sentence to conclude Forex and sports might be “Forex trading is similar to sports”. Another similarity in nature between financial markets and sports is the opportunity or possibility. Even if a boxer spends thousands of hours practicing, he won’t necessarily win the Olympics. As with traders , even if a trader analyzes the market for thousands of hours, it does not guarantee he will be the best trader .
So, is it enough to stay at home without doing anything in the hope that everything will come by itself? Of course not! If you have a goal, be it in the world of trading or sports, you have to pursue it until the best results. Whatever your struggle will be, there will be results, and this is better than just thinking or concluding earlier that the opportunity is small, and then giving up just like that.