No trader should trade with desperations

Desperations can come from only one thing which is the trading money. It is hard to lose a trade when you are investing your hard cash into the trading account. You will get more frustrated when the losses are too much to handle. A novice Singaporean trader can easily lose multiple trades due to improper trading skills and strategies. It is the reality for every single trader. Based on the survey, more than 95% of the traders lose their money in Forex. If the capital is borrowed from someone else, traders get more emotional and desperate with the losses. For those traders, it is very easy to fall for overtrading or micromanagement. If you experience the same, your trading account will not last very long. It will turn into a lost project within a month.

We are here with this article to prevent desperation from getting into the nerve of the traders. There will be a few segments which are based on proper management of the trading capital. If you want to survive and ensure a proper trading career, read this article properly. When you invest initially in the trading account, try to be decent with it.

Invest a small amount of money initially

A trader needs to influence the trading mind to use the lowest trading capital possible. For each trades, the risk exposures must be like 1% of the trading capital. Moreover, the traders also need to use proper leverage to the lots. You may be enticed by the fact of leverage but the concept is different for efficient trading. You need to define a proper leverage ratio to ensure the safety of the trading account. According to the experts, it is safe to trade with 1:10 leverage to the trades. When you execute the strategy, the losses will impact less on the account balance.

A proper risk management plan will help you a lot while trading CFDs. For example, the stop-loss and take-profit will get a proper reference from the risk management. The risk management plan will also influence the profit target. Therefore, the traders will get a proper reference for the position sizing for the trades. You can set the entry and exit points of the trades even before doing the market analysis.   

Never borrow money from obligations

You may think of borrowing money from others to start a trading business. When someone sees the profit potential from Forex trading, he or she will start trading. In this case, it is not appropriate to invest from other sources of money. Not only other people but also the other obligations are needed to be avoided. You should not use your kid’s tuition fee or money from a mortgage. It increases the desperation of the novice trading mind.

Instead of looking for other money sources, you should start with your own money. It should be the amount which you can afford to lose. As there cannot be any emotions playing with your trading plans, it is necessary to sort out the investment. It will increase the survival potential.

Follow an efficient risk management plan

When you can sort out the initial investment, it will decrease the urge of making a profit. The traders still need to use a proper money management plan for the risk exposures. It is necessary to sort out the investment into the trades. We have already mentioned the 1% money management policy for the trades. Following the strategy and also using proper leverage like 1:10, you need to define the best trades possible. Without any hesitation or stress, you can trade in the markets. The best trading approach is possible with risk management when traders can accept safe trading.

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Created on Sep 23rd 2019 06:13. Viewed 298 times.

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