HomeAboutRegulationThe risksResultsContactMembersManaged accounts

All Forex trading sites, brokerages and information exchanges have, or should have, disclaimers that alert users to the fact that this activity carries high risk. It could not be any other way, given the potential for profits that exists in Forex. High profit potential always incorporates corresponding levels of risk.

We have done, and continue to do, very large amounts of research so that we can at least attempt to know the occasions when this high risk is likely to affect our trading accounts. In the immortal words of Donald Rumsfeld, US Secretary of Defense under both Bush presidents, there are Known Unknowns and Unknown Unknowns. Such things as US presidential elections, referendums on major currency-user nations leaving an important economic and political union, such as the 2016 plebescite on Britain leaving the European Union (EU), an act that has become known as "Brexit", are cases of Known Unknowns. With experience these things are not too difficult to deal with, as they are well flagged in advance, and it is open to the wary trader to simply stay out of the market at the critical time.

Then there are the Unknown Unknowns. Perhaps the most notorious of these in the recent past was the sudden and totally unexpected announcement on the 14th of January 2015 by the Swiss National Bank (SNB) that is was breaking the link it had been maintaining between the Swiss franc (CHF) and the Euro (EUR). This caused a precipitate and dramatic fall in the EUR/CHF pair (see chart), as well as equally traumatic movements in other trading pairs that were linked in any way to the two currencies immediately concerned.

The fall in the EURCHF pair on that occasion had all the hallmarks of a "flash crash". It is ironic that it was caused by a central bank announcement, as this type of event is more normally associated with rogue traders or even irresponsible and / or unscrupulous High Frequency Traders.

The bottom line is that any of the events discussed above would have caused heavy losses if our system had been in the market and on the wrong side* of the trade when they occurred, particularly if they had taken place during a relatively elevated leverage part of the trading cycle that occurs from time to time in the operation  of our system. 

* If we had been on the right side of the trade we would have had a windfall profit. But that is not the way we like to operate. We like to be in control, as much as possible, and attempting to exploit rare, dramatic events is not the best way to do Forex trading.





This 
is the managed Forex trading account site of Seamus McKenna MBA.  <MORE>






The Omicron Forex Trading Manual
is, according to Dermot Desmond, Ireland's legendary financial manager and investor, "... essential reading for anybody, not alone those trading the Forex markets but the fundamental wisdom and practices therein can be employed in many other markets.   Seamus has the ability to educate the reader in a very clear and pragmatic manner.  In summary, he tells you how to protect the downside and how to lock in the upside".

You can buy it on Amazon by going to Amazon UK or to Amazon USA.