APTFAPTF risk disclosure: what a forex trader risks
The APTF risk disclosure is a mandatory warning written so that it can actually be read. Below is what exactly you risk losing on the currency market and what our materials do not do.
What exactly you risk losing
The main and obvious risk. Trading on the currency market does not guarantee a result, and most retail accounts are loss-making according to the disclosures of regulated brokers.
moneyWhen a quote gaps, the position is closed at whatever price comes first, and the remainder of the account can go negative. The obligation to write off such a debt is not fixed everywhere or with every company: read the agreement before you transfer money.
debtReaching stable execution of the rules takes months, statistical confidence takes years. These are sunk costs, and they are rarely counted in advance.
durationA round-the-clock market, night trading and constant tension have entirely measurable consequences — from sleep disorders to burnout and gambling addiction.
not only moneyWhat increases the risk specifically on forex
- Leverage
- Multiplies the result of any decision. A one-percent move against the position at 1:100 leverage with margin fully used means losing the whole deposit.
- Round-the-clock trading
- There is no external signal to stop. The limits have to be set by you — see the daily limit.
- Swap
- Holding a position overnight is paid for daily. Sitting on a loss for a long time costs money on top of the loss itself.
- Slippage on news
- The stop is filled at the nearest available price. The actual loss can exceed the calculated one.
What our materials do not do
What to check in the agreement before opening an account
Some of the risk is determined not by the market but by the terms of a particular broker. The six points below are checked in the documents before you transfer money, not after.
The name of the supervisory body, the country where the company is registered, and whether that legal entity matches the one named in your agreement.
checked in the regulator's registerWhether there is an obligation to write off the debt when the account goes negative. In some jurisdictions this is a requirement of law, in others it is not.
checked in the agreementWhether client money is held separately from the company's own funds, and at which bank.
checked in the agreementWhether trades are routed to an external liquidity provider or filled internally. The conflict of interest depends on this.
checked in the terms of businessTimelines, fees, restrictions and verification requirements. This is to be read before you fund the account, not at the moment of your first withdrawal request.
checked in the terms of businessWhether the broker may change the spread, leverage and swap unilaterally, and with what notice.
checked in the agreementWe do not compare brokers and do not recommend any of them: that is a separate topic with separate requirements for checking facts. But the list of what is worth reading does not change because of it.
How to reduce risk while staying in the market
Risk cannot be removed entirely — it is the source of the result. There are four levers you control, and all of them are on your side.
| Lever | What it does | What you pay with |
|---|---|---|
| Position size | The only lever that affects everything at once: the depth of the drawdown, the risk of ruin, the tolerance of a losing run | A proportionally smaller result |
| A stop order at entry | Limits the loss to a number known in advance | Part of the trades closed on a pullback before the move |
| A daily limit | Limits the loss for the session regardless of your state | A few trades a month |
| Refusing to hold overnight | Removes the swap and the weekend gap | Strategies designed to run for several days |
1 % risk → under 0.1 % · 3 % risk → 28.5 % · 5 % risk → 91.5 %
calculated in the risk-of-ruin calculator
The legal status of the materials
The wordings below exist so that a reader understands what exactly the text on the site is, and does not take it for something it is not.
- This is informational material
- Not individual investment advice and not an offer to make trades. We know neither your financial position, nor your goals, nor the risk that is acceptable to you.
- We do not provide financial services
- We do not manage funds, do not accept deposits, do not give access to trading and do not act as an intermediary between you and a broker.
- The calculations are models
- They show what follows from your inputs by the stated formula. The inputs are a hypothesis, and the main assumption in them is that the system's edge holds over the whole distance.
- Responsibility for decisions is yours
- Every action on the account you take yourself, and its consequences fall on you.
- Check the terms at the source
- Spread, commission, swap, leverage and negative balance protection differ between brokers and change over time. The values on the site are illustrative.
- Materials can go out of date
- The date of the last review is given at the bottom of every page. The rules of markets and the terms of companies change faster than texts do.
If trading has got out of control
If you are trading on borrowed money, hiding it from those close to you, unable to stop after a decision has been taken, or increasing the amounts to get the old feeling back — stop trading and see a specialist in addictive behaviour. The signs are listed on the page about gambling and compulsive play. No risk management rules help in this situation: they are broken by the very mechanisms that were supposed to hold them.
Frequently asked questions
Can you really end up owing the broker money?
Yes, that scenario exists. On a price gap the close happens far beyond the calculated stop-out level, and the minus exceeds the amount you paid in. Whether that debt is written off depends on the company and the country of registration; the question is settled by reading the agreement, not by hoping.
Is it true that most people lose money?
According to the disclosures of regulated brokers the share of loss-making retail accounts is indeed high. The exact figure depends on the company and the period and does not come down to a single number — examined in myths about trading.
Does a small deposit reduce risk?
It reduces the absolute amount of the loss, but not the share: the percentage of risk per trade and your behaviour stay the same. What a small deposit does do is make your first mistakes cheap, and that is its main benefit.
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