3 basic risk in forex

Any type of opportunity that can provide a return on your investment also carries a certain amount of risk. There is also risk involved. The higher the risk in an activity, the higher the possibility is to make larger profits. No risk, no opportunity exists. It is important to understand the three largest areas of risk in the Forex trading markets.every investment is risky but the risks of loss in trading off-exchange Forex contracts are even bigger. That's why once you decide to be the player in this market, you'd better realize the risks connected with this product for make suspended decisions before investing.
In Forex you are operating big sums of money, and it's always possible that a trade will turn against you. The Forex trader should know the tools of advantageous and careful trading and minimizing losses. It's possible to minimize the risk but no one can guarantee eliminating it. Off-exchange foreign currency trading is a very risky business and may not be appropriate for all market players. The only funds that can be used for speculating in foreign currency trading, or any kind of highly speculative investments, are funds that represent risk capital - for example, funds you can afford to risk without worsening your financial situation. There are other reasons why Forex trading may or may not be a suitable investment.

3 basic risk in forex

1.Your Broker:

Counter party risk is the second area to understand. Does your broker make money when you profit? Does he or she collect a fee no matter what you do? Most often, brokers make money when you make larger trades. Your broker is not interested in helping you, but he or she wants you do larger spreads.

2.There's risk of losing your whole investment!

You will be asked to deposit an amount of money, called the "security deposit" or "margin", with your Forex dealer in order to buy or sell an off-exchange Forex contract. A small amount of money can let you hold a Forex position many times bigger than the value of your account. This is called "gearing" or "leverage". The smaller the deposits related to the underlying value of the contract are, the greater the leverage turns out to be. If the price moves in an unpreferrable direction, high leverage can bring you large losses compared to your first deposit. That's how a small move against your position may become the reason for a large loss, and even the loss of your entire deposit. If it's pointed in the contract with your dealer, you may also be required to pay extra-losses.

3.Credit Risk 

This is the possibility that one party in a FOREX transaction may not honor their debt when the deal is closed.  This may happen when a bank or financial institution declares insolvency.  Credit risk is minimized by dealing on regulated exchanges which require members to be monitored for credit worthiness.