Forex trading is arguably one of the most fluid and lucrative financial markets available to traders internationally. This fluidity and volatility entice forex traders to believe they can make a lot of money very quickly. 

However, just like a fast vehicle can be dangerous, high volatility also puts traders at risk of losing a lot of money very quickly if they do not manage their risk. 

Losing money as novice traders is very common, and risk management is often the cause of losing capital. Risk management is an essential aspect of trading. 

Risk management is how to limit losses, preserve capital, and trade with discipline rather than emotion. The majority of new traders focus only on the possibility of making money, whereas, professionals focus on risk management above everything else. 

Professionals know if they do not preserve their capital, they can not continue to participate in potentially profitable trades over time. New traders should also be prepared and implement risk management in the forms of limiting the percent of capital risked for each trade; using stop-loss orders; being aware leverage amounts and paying careful attention to leverage; and diversifying trades across currency pairs.