There are different types of risks that you should be aware of as a Forex trader. Here are some of them.
Leverage Risk: There are both positive or negative impact on leverage in trading. If you take high leverage, it may make you more beneficial or looser.
Interest Rate Risk: If any country's interest rate rises, the currency could be strong. You can be profitable. But if the country's interest rate falls, the currency may weaken, which occurs in more investors withdrawing their investment.
Transaction Risk: It can take place sometime between the beginning and end of a contract. This risk is an exchange rate risk that can be associated with the time differences between the different countries. There is a chance that during the 24-hours, exchange rates will change even before settling a trade. The transaction risk increases the greater the time difference between entering and settling a contract.
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