Many Forex traders waste a good deal of time trying to devise strategies to completely avoid risks and it never works out. Profits and losses are two sides of the same coin, and much like a coin toss, predicting the outcome of a Forex trade is impossible, almost. There have been many instances where trades that were looking completely healthy, took a wild turn towards losses. The Forex trading market's volatility can be blamed for that. However, losing money to usual trades due to greed and overconfidence? This blame will always fall on the trader!
Risk management is a very crucial aspect of Forex, one that needs complete mastery if you want to have a profitable and long-lasting Forex career! Here are 4 tips on risk and money management:
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| Tips to Have a Risk Free Forex Trading in Sri Lanka |
1) Acknowledge the Recurring and Stubborn Nature Of Losses: You can't manage that which you don't accept. So start off with accepting the simple fact that losses, no matter how hard you try to avoid them, will incur while Forex trading. The best approach isn't to try and scour the charts for losing trends to avoid; it is simply to stay prepared with stops, risk capital and limiters.
2) Avoid Getting Greedy: Greed begets nothing good; let yourself be fueled by ambition, but don't let it convert into greed. Traders often give into their more primal emotions and start looking for profits in trades that exceed their grasp. The problem with this is that you can make 10 good trades and earn stellar profits from them, and lose that all to one bad exchange. The moral being, don't get greedy.
3) Risk Only 3-4% Of Your Capital: Telling you not to risk would be counter-productive because certain risks have to be taken to realize bigger profits. It is how much you risk that matters most. Professionals advise against risking any more than 4% of your trading investments and following a slightly frugal Forex trading strategy.
3) Risk Only 3-4% Of Your Capital: Telling you not to risk would be counter-productive because certain risks have to be taken to realize bigger profits. It is how much you risk that matters most. Professionals advise against risking any more than 4% of your trading investments and following a slightly frugal Forex trading strategy.
4) Learn How To Place Stops Precisely: One of the best ways to manage capital is by minimizing losses, and placing stop-losses is an incredible way to do it. The trick is to place stops properly, instead of letting premature stops pull you out of trades before making a single cent's win.
With some practice on a good Forex demo account, you can start working towards an incredibly profitable Forex trading career! Sign up with WesternFX and avail our world-class brokerage today, assisted by our experts, you will get unparalleled guidance at all times. We will teach you how to manage capital and make the most out of each exchange. Call us today to know more!
With some practice on a good Forex demo account, you can start working towards an incredibly profitable Forex trading career! Sign up with WesternFX and avail our world-class brokerage today, assisted by our experts, you will get unparalleled guidance at all times. We will teach you how to manage capital and make the most out of each exchange. Call us today to know more!
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