Accompany with WeTrade: How is risk control important?

"I would like to remind you to pay attention to the major economic news events that occurred from 16 October to 19 October. Such events with great economic and sociopolitical significance may cause severe market fluctuations." This is WeTrade, the broker, has updated an announcement on its official website. It is also a warning that many brokers will remind investors when market changes occur.

In life, we often encounter similar warning signs in relevant public places - "Prevent falling into the water", "Be careful of dangerous animals", and "Don't go out in typhoon weather". But as the saying goes, "those who know how to swim will be drowned" and "those who know how to play with electricity will be beaten to death." If you want to be the trendsetter of the times, you will end up being the one being played. This is the fate of most people.

In fact, the root cause is a lack of respect for nature and an insufficient assessment of risks. Although dangers and opportunities coexist, only by controlling the lower limit of danger can we have the opportunity to explore the upper limit of opportunity. The same is true for trading. 100% profit, or even 500% profit, will not be worth a big drawdown or liquidation in the end. The one-year trading competition held by the community uses a 30% drawdown as the bottom line to compete for long-term survival and profitability. The purpose is also the same. However, the competition lasted less than 4 months and only 35 of the hundreds of participating accounts survived. Risk control is so difficult.