{"version":"1.0","provider_name":"For overseas forex cashback services, try Money Charger","provider_url":"https://money-charger.com/en/","author_name":"admin","author_url":"https://money-charger.com/en/author/admin/","title":"Is it possible to incur debt through overseas forex trading? We explain the reasons for debt and how to avoid the risks - Money Charger (Overseas Forex Cashback Service)","type":"rich","width":600,"height":338,"html":"What are the chances of incurring debt through overseas forex trading? This article explains the reasons for debt and how to avoid the risks
\n","description":"One of the attractions of overseas forex trading is the ability to make large trades with a small amount of capital. Furthermore, if you use an overseas forex broker that has implemented a zero-cut system, your margin will not go into negative territory. However, while your margin will not go into negative territory, there is still a possibility of incurring debt. This article will explain in detail the reasons and causes of incurring debt in overseas forex trading. In addition, we will introduce ways to avoid the risk of incurring debt and how to deal with it if you do incur debt, so if you want to \"trade overseas forex without risk\" or \"don't want to incur debt from overseas forex trading,\" please refer to this article. If you are looking for a highly secure overseas forex broker, please also check out our ranking of popular and highly-rated overseas forex brokers based on actual customer reviews. Also, if you are a beginner in overseas forex trading, we recommend that you read this complete guide for overseas forex trading beginners. Reasons for incurring debt in forex trading Here, we will explain in detail the reasons for incurring debt in forex trading. This content is common to both domestic and overseas forex trading, so please refer to it if you are investing in forex. The reasons for incurring debt in forex trading are as follows: Stop-loss orders are not executed and margin calls occur The reason for incurring debt in forex trading is that stop-loss orders are not executed and margin calls occur. In FX trading, a \"stop-loss\" order is executed when the margin falls below a certain level, automatically closing the position. This system prevents the margin from going into negative territory. However, in the event of rapid price fluctuations, stop-loss orders may not be executed at the correct price, and the stop-loss may not be executed in time. If the stop-loss is not executed in time and the margin goes into negative territory, additional margin (margin call) will be required. While overseas FX brokers have a zero-cut system that prevents margin calls, domestic FX brokers will definitely issue margin calls, so caution is necessary. The reason why people incur debt in FX is because they repeatedly add margin without being able to cut their losses. In FX trading, if the price moves in a direction different from what you expected, and you continue to hold the position without cutting your losses, your losses will only increase. If losses increase while holding the position, you will be forced to add funds to avoid triggering a stop-loss. As a result of continuously adding funds, there is a risk of running out of funds and incurring debt, so caution is necessary. The psychology of \"not wanting to lose money\" is at play, but it is important to set clear trading rules and invest accordingly. Trading with borrowed money from consumer finance companies or credit card companies The reason why people incur debt in FX trading is because they borrow money from consumer finance companies or credit card companies to trade. When you raise investment funds in FX using consumer finance companies or credit card companies, you will be in debt. If you trade using money you have borrowed, you will have to repay the debt from your own assets if you incur losses. This can disrupt your daily life, so you need to be careful. In order to continue investing without strain, it is important to trade with surplus funds and have some leeway. Why is the possibility of incurring debt lower with overseas FX? Overseas FX is less likely to result in debt compared to domestic FX. Here, we will explain in detail why the possibility of incurring debt is lower with overseas FX. The reasons why overseas FX is less likely to result in debt are as follows: Zero-cut system is implemented Many overseas FX brokers have implemented a zero-cut system, so the possibility of incurring debt is low. A zero-cut system is a system in which the FX broker covers the negative amount when a stop-loss order is not executed in time and the margin becomes negative. As a result, no margin call occurs and traders do not incur debt. The zero-cut system is not implemented in domestic FX. Therefore, if you want to avoid margin calls, you should use an overseas FX account. Please check the article below for the disadvantages and risks of the zero-cut system ↓ Lower stop-loss levels compared to domestic FX Overseas FX has lower stop-loss levels compared to domestic FX, so the risk of forced liquidation is lower. With a low stop-loss level, even if the market moves against your prediction, you have time before forced liquidation, so there is a possibility of recovering your losses. However, losses can also increase, so it is necessary to set a stop-loss line and take positions accordingly. Below are the stop-loss rates for domestic FX brokers and overseas FX brokers. FX Broker Stop-Loss Rate Tradeview 100% XM 20% AXIORY 20% IS6FX 20% TitanFX 20% FXGT 20% Bigboss 20% Exness 0% iFOREX 0% FX Broker Stop-Loss Rate Gaitame Online 100% Gaitame.com 100% Traders Securities 100% Kabu.com Securities 100% DMM FX 50% SBI FX Trade 50% GMO Click Securities 50% Rakuten Securities 20% Reasons for Incurring Debt with Overseas FX While the possibility of incurring debt with overseas FX is low, it is possible. Here, we will explain in detail the reasons why you might incur debt with overseas FX. […]"}