Trading carries a high level of risk, and you can lose your investment amount. Here's what's at risk, what isn't, and how to protect yourself.
What you can lose
- On each trade: if a trade loses, you lose the whole trade amount. The payout and the possible loss are fixed before you buy.
- In total: never more than the balance in your account. There's no leverage, no margin and no debt.
Where the risk comes from
- Short-term moves are hard to predict. Payouts are high because predicting where a price will be in 30 seconds, 5 minutes or 24 hours is extremely difficult.
- Losses add up quickly. A run of losing trades can empty an account in minutes if the trade amounts are large.
- Emotions. Raising your trade amount to win back a loss is the most common way traders lose more than they planned.
How to protect yourself
- Only trade money you can afford to lose.
- Keep each trade small. A common guideline is 1% to 2% of your balance per trade: with ¥100,000, that's ¥1,000 to ¥2,000. Our minimum trade is ¥500 ($5), so this works even with a small balance.
- Decide your limits in advance: how much you'll risk, how often you'll trade and when you'll stop for the day. Then stick to them.
- Practise on the demo account until you know how each trade type works.
Zentrader is a platform for self-directed traders. We don't provide investment advice, and every trading decision is yours.
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