Trading in the financial markets is often misunderstood as gambling by the general public. While this comparison isn’t entirely accurate, there are traders who unknowingly approach trading like gamblers, which reinforces this misconception.

Gambling is driven by the desire for quick profits, which usually comes with high risk and low chances of success. Since financial markets are inherently risky and can generate significant profits, many people mistakenly associate trading with gambling.

However, the reality is different. At FOREXIVE, we emphasise to our traders that trading is not about making quick money—it’s about achieving consistent results over time. So, how can traders avoid gambling behaviour in their trading practices?

Be Cautious of Unreliable Prop Trading Firms

Choosing an untrustworthy prop trading firm is a form of gambling. It’s crucial to research the company’s history, reputation, and client experiences. With the internet at our disposal, it’s easier than ever to gather information. Check social media, ask questions in trading communities, and read reviews from real customers. Pay attention to whether the firm reliably pays out profits, the spreads and commissions they charge, and whether they use their own trading platforms or rely on third-party brokers you’ve never heard of.

Does their customer support respond professionally and promptly, or do you wait days for a reply? And does the firm genuinely care about the trading community, or is it just interested in collecting fees?

If you’re drawn in by overly simple account terms, rock-bottom prices, and unrealistic payout conditions, be cautious. While these offers may seem attractive, past examples show that such models often aren’t sustainable. You might make money on paper but never see it in your bank account.

Common Risky Trading Behaviours

1. Over leveraging

Over leveraging is a classic form of gambling. Some traders believe that the larger the position, the faster they’ll make a fortune. However, this approach can lead to significant stress due to the possibility of large losses. It also increases the likelihood of mistakes, derailing the trader’s plan.

Opening large positions limits flexibility. For instance, at FOREXIVE, traders must consider the Maximum Daily Loss limit. Opening additional positions increases the risk of exceeding this limit if the market moves against them. This can lead to reduced stop losses or missed opportunities, further compounding losses. Revenge trading, where traders try to recover losses with a single big trade, is equally problematic.

Even successful traders can fall into the over leveraging trap, mistakenly believing that if smaller positions work, larger ones will too. Unfortunately, this often leads to large losses and violated trading objectives.

2. Overexposure

Diversifying across multiple instruments can also turn into gambling if traders aren’t careful. For example, opening several positions across different currency pairs might seem diversified but could actually be a single big bet on the US dollar. Overexposure can also happen when traders scale into positions without considering the risks. While catching a trend might seem like a good idea, it’s crucial to ask: Is this really a diversified strategy, or just the same trade repeated?

Traders should avoid opening positions so large that they use up all available margin. Even with stop losses in place, factors like slippage, sudden price fluctuations, and market gaps can lead to unexpected losses. Trading large positions is risky and isn’t recommended at FOREXIVE. Professionals often risk only 1% of their capital and still achieve significant profits in a stable, controlled manner.

3. One-Sided Bets

Placing a large bet on a single instrument is another form of gambling. This includes adding to winning or losing positions, as mentioned earlier. If the initial position is already large and exceeds reasonable risk limits, adding to it is pure speculation. While adding to profitable trades can work in strong trends, are you confident the trend will continue long-term?

Opening additional positions in a losing trade, hoping to reverse the market, only increases stress and potential losses. This approach has nothing to do with serious trading, which requires a proven strategy that can be executed consistently over time.

A one-sided bet typically involves risking a large portion of free margin on a single market event, often driven by macroeconomic factors. While this might work occasionally, it’s unlikely to succeed consistently. Targeting the extremes of market movements is always risky.

4. Account Rolling

Account rolling is a form of gambling unique to prop trading firms. Some traders purchase multiple evaluation accounts, complete them, but due to maximum allocation limits, they can’t trade all accounts simultaneously. This leads to reckless trading on one account, with the belief that if it fails, they can just move to the next one.

At FOREXIVE, we encourage traders to adopt a different approach. Our Scaling Plan allows traders to increase their capital every four months, with the added benefit of improving their payout ratio from 80% to 90% after the first increase. Reckless account rolling undermines this opportunity.

Completing multiple evaluations should lead to steady account growth, costing less and offering a higher percentage of profits. While rolling accounts may eventually succeed, it misses the point of the evaluation process, which is to test a trader’s strategy and consistency. This approach can be seen as system abuse, which is not something we support at FOREXIVE.

Conclusion

Gambling is a high-risk endeavour, and unfortunately, trading is often mischaracterised in this way. Remember why you started trading. Was it to make quick money, or was it to find a consistent income source that you can generate from anywhere in the world over the long term?

At FOREXIVE, we care about our traders’ mental well-being and the reputation of trading as a profession. We actively monitor gambling behaviours and take steps to discourage them. Join us in changing the perception of trading for the better. Let’s show the world that real traders are professionals who take calculated risks based on a proven edge in the market, not gamblers chasing quick wins. Serious trading requires dedication, discipline, and a commitment to long-term success.

And if your motivation is to get rich quick, you might be better off trying your luck at a casino. But even then, it’s not the smartest choice.