Money Management
I have recently noticed that you have reduced you trading activity and you are hardly opening positions. Even though you recently encountered some loses on your account, you shouldn’t let it reflect your trading capabilities. Most new traders quickly become discouraged due to a few losses, giving up on this potential market. To help you develop a strategy and allow you to overcome problems experienced by beginners, I have listed a few points below that I would advise you to take into consideration, especially as they helped me tremendously, when I first started to trade.
STEP 1: Motivation and Determination
Remember that all successful traders start from scratch. No one is born a trader and all novices go through a learning curve overcoming losing trades. The difference between a long term profitable trader and an unprofitable one is motivation and Determination.
STEP 2: Get to Know your Strengths and Weaknesses
When starting out, make a list of your strengths and weaknesses. For example, when I began to trade I noticed the following:
My Strengths
* The direction of my trades were correct.
* My take profits were hitting on most of
my trades.
My Weaknesses
* Losing trades were erasing my account
By jotting them down on a piece of paper, I quickly realized that I wasn’t using correct money management. I was risking much more than I was taking as profit on each trade. After adjusting my risk/reward ratio ,making sure that the distance from my entry point to my stop loss was less than the distance between my entry point and my take profit, I found that even if I did experience a losing trade, my winning trades still kept my overall account in profit!\
STEP 3: Testing Your Strategy:
No strategy is perfect from the start; you might find that you will need to adjust your strategy along the way. From personal experience it takes around 30-50 trades to determine whether the strategy is good or doesn’t suit you. Over the years I have developed a few strategies that I use still today, some are better than others, but on all of them I use correct portfolio management, as explained in step 2
STEP 4: Making the Adjustments:
Once you see that your strategy is closing more positions in profit than in loss, all you have to do is adjustment the strategy slightly to increase your success rate. After you’ve traded enough trades with your strategy, you then need to review your trades and change the things you find don't work well. For example, you might find that when analyzing you trades on the charts, you could have increased your take-profit order, as the trend anyway continued on most of your positions in the direction that you wanted it to go.
Once again don’t be discouraged from a few unfortunate losses. Trading takes time and patience. Think about it, if it was that easy, everyone would be a successful trader.
A Few Last Remarks:
* By depositing now $500, you can get a
Personal Account Manager which will
help you develop your strategy, and
which you can contact any time with
any question that comes to mind
* Once you have your own strategy, practice
sticking to it. You must test it thoroughly
and see how you respond to the framework
you have created for yourself.
STEP 1: Motivation and Determination
Remember that all successful traders start from scratch. No one is born a trader and all novices go through a learning curve overcoming losing trades. The difference between a long term profitable trader and an unprofitable one is motivation and Determination.
STEP 2: Get to Know your Strengths and Weaknesses
When starting out, make a list of your strengths and weaknesses. For example, when I began to trade I noticed the following:
My Strengths
* The direction of my trades were correct.
* My take profits were hitting on most of
my trades.
My Weaknesses
* Losing trades were erasing my account
By jotting them down on a piece of paper, I quickly realized that I wasn’t using correct money management. I was risking much more than I was taking as profit on each trade. After adjusting my risk/reward ratio ,making sure that the distance from my entry point to my stop loss was less than the distance between my entry point and my take profit, I found that even if I did experience a losing trade, my winning trades still kept my overall account in profit!\
STEP 3: Testing Your Strategy:
No strategy is perfect from the start; you might find that you will need to adjust your strategy along the way. From personal experience it takes around 30-50 trades to determine whether the strategy is good or doesn’t suit you. Over the years I have developed a few strategies that I use still today, some are better than others, but on all of them I use correct portfolio management, as explained in step 2
STEP 4: Making the Adjustments:
Once you see that your strategy is closing more positions in profit than in loss, all you have to do is adjustment the strategy slightly to increase your success rate. After you’ve traded enough trades with your strategy, you then need to review your trades and change the things you find don't work well. For example, you might find that when analyzing you trades on the charts, you could have increased your take-profit order, as the trend anyway continued on most of your positions in the direction that you wanted it to go.
Once again don’t be discouraged from a few unfortunate losses. Trading takes time and patience. Think about it, if it was that easy, everyone would be a successful trader.
A Few Last Remarks:
* By depositing now $500, you can get a
Personal Account Manager which will
help you develop your strategy, and
which you can contact any time with
any question that comes to mind
* Once you have your own strategy, practice
sticking to it. You must test it thoroughly
and see how you respond to the framework
you have created for yourself.
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