If you’re looking to get into forex trading, you may ask someone, is forex trading gambling or not? This is a very understandable confusion to have. At the surface level, it may seem like this entire industry is just a gambling game. But is this really true from the inside as well? Is online forex trading gambling? Is currency trading gambling in general? Let’s find out!
Is Forex Trading Gambling or Not?
To answer your question, forex trading is not gambling. Though most of us probably had the same confusion when we first started trading. As a beginner, you’re going to face many trades that don’t go your way. This can make anyone frustrated and call the market a gambling game.
The reality is that forex trading and gambling are two different parts of the financial industry. Don’t get me wrong. There is nothing wrong with gambling as long as you’re not careless. However, it is disrespectful to compare it to forex trading when the two are very different.
Difference Between Forex Trading and Gambling
Now that we know that forex trading is not gambling, it is only best to help you understand why this is the case. If you’ve gambled at least once in your lifetime, you know that there is a house that knows the odds of winning or losing. There is no house in the forex trading industry.
Another thing you would probably know is that you don’t know your odds in gambling. You have no idea if the odds are in your favor or if you will lose all your money. This is not the case in forex trading. Forex traders study the market beforehand so they know their odds of winning.
How to Prevent Gambling in Forex Trading?
Although forex trading is not gambling, you can turn it into gambling if you’re not careful. One of the main reasons why forex trading is not gambling is because traders study the markets before placing any trades. However, if you’re a careless trader and you’re placing trades before studying the markets, you’ll basically be gambling instead of forex trading.
Another way you could be gambling without knowing is by trading through brokers who are Market Markets or Dealing Desks. This would mean that they have full control over the markets and can change the rates to give themselves more profits. Trading through these brokers would mean that you’d be gambling as you’d never know your odds as it is in the hands of the broker.
Read More: WHY A FOREX TRADING STRATEGY FAIL?
Final Verdict
Is forex trading gambling? No, forex trading is far from a regular gambling game. You are in control of your odds if you study the market properly. If you follow the rules of forex trading, you can save yourself from the gambling tendencies of this industry. Always make sure you use brokers that are No Dealing Desk instead of Dealing Desk as this would save you from partaking in fraudulent activity.
