Trade volume and stop order
Control of the trade volume is one of the basic
conditions for successful trading. Unfortunately, some novice traders,
driven by the desire to get rich quickly, trade for the entire deposit. Options for outcome
that kind of trading just doesn’t exist. The trading account will definitely be merged. From the very beginning.
you need to establish a rule on the size of the trade for yourself. For starters…
I’d recommend that we stop at 1-2% of the deposit. And as you accumulate.
of experience, you can raise the bar to 3-5%.
The next method of risk reduction is to use a stop order. Its effectiveness will largely depend on how well the size of the stop loss has been determined. He must have a logical reasoning. Most often, the significant levels formed on the chart or local extrema are used for this purpose. But in any case it is necessary to define the size of SL not only in points, but also in money. Your possible loss should not exceed 1-2% of the deposit amount.
Ration between TP and SL
Many trading strategies provide for profit taking by take-profit. Its optimal size will increase the efficiency of the trading strategy. The trading system will be generally profitable if the number of profitable trades is not less than 50% of the total number of open orders. At the same time, the amount of potential profit on each trading position should be 2-3 times higher than the amount of possible loss. If the trader is aimed at a higher profit result, then the trading strategy should provide for the transfer of the transaction to a lossless position.
Diversification of risks
This should be remembered for any type of investment.
Trading in different unrelated trading instruments allows
to save their money in any development in the marketplace. As a rule,
Traders choose currency pairs with the dollar for trading. And that’s understandable. That’s exactly what I’m saying.
they show high volatility, which is important for earnings. But it’s not…
will prevent you from paying attention to other tools as well: pairs that do not
dollars, indices or stocks. There’s always a choice. And then the losses in one currency
the pair can be covered by profit on another trading instrument.Forex risks can be very insignificant in practice, if the trader takes the necessary measures in due time.Fyodorov’s Inga17.10.2019