I was at the playground the other day with Chloe and while watching her up on the slide area, this thought came to my mind. Trading in the forex or equities market is actually the same as raising up a child!
Here is why
i think so;
1) You never know if she is going to slide down or climb up!
I was at the bottom end of the slide waiting for her to slide down and making sure she does not fall. All indications point to her making that move down. But in a split second, she changes her mind and decides to climb the steps to another section of the playground! How irrational is that?
In Forex trading, there are many indicators that i follow before making a trade. However, there are cases where even when all indicators point to one direction when i enter a trade, it could go a complete different way the very next moment!
2) You need to watch her all the time!
Ok, maybe not really All the time, but watch her you must. There is always a chance she might slip and fall, knock onto something, put things inside her mouth and a whole list of other stuffs.
In Forex trading, you can watch your price all the time or in different time frames like 1 minute, 1 hour etc. But you really need to watch it as the price can go up and down without any reason even if it's just 1 minute and you could end up in a losing trade.
3) Your emotions go up and down with her!
When your child is naughty, you get angry with her. When she laughs or smile at you, you are the happiest person in the world. When she is sick or knocks onto the table and cries, your heart feels like breaking as well.
In Forex trading, (we talk about money management some other time) if you enter the trade with the trend and the trend goes according to your direction, you will be most happy as you are making a profit and a whole lot of feel good factor. However if against all calculations, the trade you enter goes in the opposite direction, you will feel awful....
4) You read up on everything about her
'How to raise a healthy child?', 'Why do toddler behave like they do?' Every time you see some article are report relating to babies or toddlers, you tend to pick it up and try to understand as much as you can. If anyone starts a conversation about children, you would share your thoughts or worries no matter how introvert you are. It's like a magnetic topic, a natural ice breaker! You are interested in everything baby!
In Forex trading, there are a 101 ways to spot trends and trade, you wish you know them all. You want to have the best indicator, you want to make that winning trade, you are interesting in everything forex.
5) You need discipline with her
Children like to 'test water'. They like to test the limit on the things they are allowed to do. If you allow them to do wrong the first time, they will try to do one step
In Forex trading, a lot of discipline in terms of money management is required. If you set out to take 20 pips profit each time, you might be tempted to take 30 pips the next time which could be disastrous. Therefore again, it is up to you to determine your own money management so that you would not burst your account.
Do you still think forex is risky? Check out my forex trading here!