I recommend you pin this channel at the top of your chats so you won't miss anything coming from us.
Today I will be teaching on a very vital topic. "Trade management" I will be talking about how to manage your risks, risk to reward ratio, compounding profits etc
If you have any questions pertaining to whatever taught here, drop it on the WhatsApp groupchat u belong to, I will do justice to it.
Today I will be teaching on a very vital topic. "Trade management" I will be talking about how to manage your risks, risk to reward ratio, compounding profits etc
If you have any questions pertaining to whatever taught here, drop it on the WhatsApp groupchat u belong to, I will do justice to it.
Thanks for joining. Tonight I will be talking about a very crucial aspect of trading be it Forex, Crypto, stock etc whatever you are trading, without it you will never make profit over time. This aspect is trade management.
You must learn how to manage your trade appropriately, if you don't manage your trade, most of the time you will blow your account not because your analysis is wrong but simple because you failed to manage your risk appropriately.
Even if you are supplied with accurate signal if u don't manage your trades well at long run you will end up no being profitable.
Components of good trade management is:
1. Good risk management
2. Good rrr (risk to reward ratio)
There are lots more I will be adding over time, but for tonight I will focus on these two.
You must learn how to manage your trade appropriately, if you don't manage your trade, most of the time you will blow your account not because your analysis is wrong but simple because you failed to manage your risk appropriately.
Even if you are supplied with accurate signal if u don't manage your trades well at long run you will end up no being profitable.
Components of good trade management is:
1. Good risk management
2. Good rrr (risk to reward ratio)
There are lots more I will be adding over time, but for tonight I will focus on these two.
What is risk management?
I would say risk management is the act of risking only what you truly are affordable to lose on a trade, or in other word the amount you accept and willing to lose should your trade go against you. The moment you open a trade and you are afraid of it hitting SL then your risk management is poor.
So how much lose is okay per trade?
You should understand that during bad trading days u may have your SL hit 5-10 times in a row. Yes it's very very possible even the most profitable trader can fit SL on 5 straight trades.
Now as a newbie u can hit SL more times than that, u can hit 5,10 straight SL. It's not a big deal. On every SL you will keep learning.
Without good risk management just 5 SL you have blown off your trading equity.
My recommendation is that you don't have a SL that's bigger than 2-5% of your Portfolio. So that even if you hit SL 10 times in a row, you will only lose maximum of 50% of your portfolio and you will still have 50% left to fight back.
To do this simply use a lotsize that's suitable to achieve not more than 5% of capital as SL target. And also trade setups with lesser pips to the SL price.
I would say risk management is the act of risking only what you truly are affordable to lose on a trade, or in other word the amount you accept and willing to lose should your trade go against you. The moment you open a trade and you are afraid of it hitting SL then your risk management is poor.
So how much lose is okay per trade?
You should understand that during bad trading days u may have your SL hit 5-10 times in a row. Yes it's very very possible even the most profitable trader can fit SL on 5 straight trades.
Now as a newbie u can hit SL more times than that, u can hit 5,10 straight SL. It's not a big deal. On every SL you will keep learning.
Without good risk management just 5 SL you have blown off your trading equity.
My recommendation is that you don't have a SL that's bigger than 2-5% of your Portfolio. So that even if you hit SL 10 times in a row, you will only lose maximum of 50% of your portfolio and you will still have 50% left to fight back.
To do this simply use a lotsize that's suitable to achieve not more than 5% of capital as SL target. And also trade setups with lesser pips to the SL price.
👍1