Is it better to avoid Exotic currency pairs? Why?

[ReggieFx]

Lately, I have been watching the market of exotic currencies which are not so commonly traded. Especially Turkish Lira, the Mexican Peso and the Brazilian Real. One of my friend said, you must avoid those pairs. That's what he learned from the experts. He could not explain it to me. Can anyone here explain that? Why exactly most people avoid these currencies?

 

[FXO_trader]

Lately, I have been watching the market of exotic currencies which are not so commonly traded. Especially Turkish Lira, the Mexican Peso and the Brazilian Real. One of my friend said, you must avoid those pairs. That's what he learned from the experts. He could not explain it to me. Can anyone here explain that? Why exactly most people avoid these currencies?

Exotic pairs are generally characterized by low liquidity and high volatility compared to other instruments. They are also susceptible to local crisis events. But why are they used anyway? You can earn high profits due to high volatility. But the risk is high... I also don't like the high spreads on these pairs

 

[Jessie]

Exotic currencies like the Turkish Lira, Mexican Peso, and Brazilian Real are often avoided due to higher volatility, lower liquidity, and greater economic and political instability compared to major currencies. This can lead to wider spreads, higher transaction costs, and increased risk for traders.