In
forex trading, you have undoubtedly read about financial management more than
once. Risk management associated with the trades must be of natural things for
expert traders, but few of them apply them in their trades in the forex. How do
you transform risk management from just a word spoken to a key part of your
trading strategy? Any investment includes the probability of high profit
includes the probability of high risk. The main principle of risk management is
to be careful and in control of your money before taking any action. This can
be a simple way to control your account, as well as help you avoid the side
appeals.
Having
a Forex demo account is a good thing for trading, but only by trading real
money will feel the psychological pressure on risking real money. But by the
beginning simply by applying the base 2% in trading strategy, it is supposed to
feel tangible changes.
1.
Never put any trading without a stop loss point
Risk
Management can help you put out a stop loss on any transaction of any situation
that might result in a significant loss during one trading process. You may
think you read this as is evident, but there are still traders who do not use
stop loss points. The worst of it, that this might be by traders at brokerage
firms in the Forex on their client accounts. It is sad but true.
2.
Always be aware of the money you are risking by
There
are plenty of ways for financial management in Forex. Most of these methods
focus on the risk / return rate. Often this rate will be at 2: 1 or 3: 1 in
some cases, and it is a good thing. But at the same time, it ignores many of
the dealers a lot of dollars that risk in both trading and whether or not a
large operation.
There
are two ways to reduce the money and risk management in your trading:
-
Select the points stop loss narrower: While identifying a breakpoint loss
narrower and looks like a strategy to lose less money in a losing trading
process, in fact it may not be the best moves you make. Determining a
breakpoint narrow loss is possible in fact to put your trades in a position
more risky. Reduce the money that you run the risk of him does not mean that
you have to increase the chance of access to the stop-loss point, and should
not be dependent on the amount of money that is being traded.
-
Reduce the size of the situation: the smaller the size of positivism is able to
give you the option selecting a point loss stopped at the appropriate level,
and you risk the least amount of money. However, the amount of the yield
decline is the other. While the majority of traders are trying to trade big the
conditions, we must remember that we are deliberating deliberative money with
added strength, and not real money we possess. By minimizing the volume of
trading and risk control management, you can still trade the full up position.
Which
brings us to the most important rule in risk management:
-
Never risk more than 2% of your account per trade:
This
rule may seem overly strict, but traders experts know how important it is not
to risk a lot in one trading process. Market moves constantly and will always
have the opportunity to deliberate as long as you have the money to trade him.
Base 2% application will help you to stay in the market for a longer period and
risk management well to the permanent collection of long-term profits.
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