The purpose of trading on the currency market is to make a profit. In order to reach it, a trader must not only have the skills of successful trading, but also have sufficient funds for trading. However, for one reason or another, this is not always possible. How to increase the size of the deposit on the trading account in order to get a good income while observing the existing rules of risk reduction? A simple solution to this issue may be the use of borrowed funds. However, this is far from being the best option. And I wouldn’t recommend using it. A reasonable solution for a trader is to gradually increase the size of the deposit. To do this, you can use such a method as reinvestment of profits, which was obtained in the process of trading.
How to increase your trading deposit
To do this, you can use one of two methods.
Full reinvestment of profit
The essence of this method is that the trader does not withdraw the earned funds, but leaves them on deposit. This option is suitable for those who have some basic income, and trading is designed only to get additional income. Refusing to withdraw funds will allow you to quickly increase the amount of funds on your trading account. Suppose the initial deposit was $1000. If the profit from trading for a month is on average 10 percent, then in a year the amount of funds on the trading account will increase more than 3 times in case of full reinvestment.
Passive reinvestment of profit
This method assumes that the trader withdraws only a part of the profit to his bank account, and leaves the other part on the deposit for its gradual increase. Of course, in this case, the increase in the amount on the trading account will not occur as quickly as in the first variant. But this method, in terms of psychology, is more comfortable for a trader. Trading in the market is a very difficult type of income. It requires knowledge, effort and time. And if a trader sees the results of his work on a bank account, it creates a favorable psychological background for further trading. With the withdrawal of 50 per cent of the profit, the initial deposit of $1,000 at a monthly yield of 10 per cent for the year may increase by 1.5-1.7 times. It is up to the trader to decide what share of profit to keep on deposit. However, we must remember that the bigger it is, the faster the trading account will increase.The full withdrawal of profits can be afforded by those traders who have a large amount of funds for trading. It is also recommended to withdraw all earned funds at once to traders who conduct extremely aggressive trading. A stable income in this case is not to be expected. Large profits from trades can be quickly lost.Fyodorov’s Inga18.02.2019