Understanding Forex - #5 - Compound Interest
This is a series of articles on the foreign exchange market. You will learn here what Forex is, how it works and how profitable it can be. The entire series contains the following articles. . . What is Forex? Technical analysis Fundamental analysis Money management Compound interest Compound interest. As an investor, time can be your best friend once you learn how to use compound interest to your advantage. This is an important aspect of any trading system. Increasing your profits can make you very rich and help you increase your investment profits exponentially. The downside to this technique is that you may also increase your risk. By reinvesting your earnings you can multiply your profits but you can also suddenly lose everything. I will explain here how compounding can make you rich. I will also describe some of the risks involved. This strategy may be suitable for some investors, but not for all. It is more like a long-term strategy. Most traders or investors don't have the pa...