Risk management

[sarah2701]

If follow a suggestion from experienced or professional trader 2% risk in every plan trading, because if use higher risk, usually how to recover the loss will harder, because loss will decreasing account balance.

Yes 2-3% risk management in every trading plan works.

 

[Donovan.CC]

Risk management is one of the main skills that most beginners lack, and with a good risk management strategy, it is possible to control your losses and increase the chances of gaining profits.

 

[Jose.Ser]

Do professional traders also use risk management to trade live? And what percent of loss can I control with risk management?

 

[Bentley11]

What type of risk management skill should every trader have before entering live trade?

 

[holycow]

You can only stick to one rule which is invest what you can afford to lose. The industry risk management standard is 2% of your total capital and in some cases 2.5%. So being a new trader, we should keep it 1% and not go beyond that in any circumstances.

 

[Malaksen]

You're quite right I think, high leverage always means high risks despite the increased chance of winning more money. Moreover incase it's used by novices it also can blow their accounts up I guess. Speaking about risk management, I'd recommend to open a position with no more than 1-2% of the total account, of course first deposit will fly away mainly because it's like a training money, you know. And there is no need in demo account because demo doesn't make feel those emotions as real account will. I'm convinced that leverage isn't quite good for beginners and they'd better concentrate on learning and practicing, it will bring them more profit.

 

[Pelvell]

Risk management is one of the main skills that most beginners lack, and with a good risk management strategy, it is possible to control your losses and increase the chances of gaining profits.

Definetely yes. I also want to add that novice would better stay away from high leverage and leverages at all mainly because it's a good way to bust their accounts and give up trading with negative thoughts about it. Leverages mean high risks and high income as well, however novices often don't pay attention to high risks and start trading with high leverage mentally counting huge sums of money. But it doesn't like that. Their unconscious actions lead to deposit dumping and then they're very disappointed with trading activity and never return to it. I tend to suppose it's the better way both for them and other traders.

 

[Felhamand]

Leverage of 1:200 is not a very safe solution. You should try something more secure, well, this is my personal recommendation.

I don't actually think that all US brokers are scammers. There are lots of reliable brokers in US or in other country. Everything you need is to check all the information about the broker and make a conclusion whether you will cooperate with it or not. You need to check certification, registration and the resposiveness of a customer support I guess. If something goes wron with these information then you may think of the reliability of this broker. To check customer support you can open an account (demo) and then ask support several questions about deposits/withdrawals and make sure that they're not scammers (in case they will treat you well), otherwise you will have to find another broker.

 

[Money Bird]

Honestly, I take a much simpler approach. I use the Earn Forex Position Size Calculator. However, I do statistics on a variety of trades I do. Depending upon the likely hood of a particular trade I'm taking to hit my take profit mark I pick somewhere between a 0.25% to 0.5% risk per position on a trade usually. However, if I'm dealing with a very high probable trade I will typically jump that upto 2% and then I'll compound it further as I go. As I compound my trades I always adjust the previous stoploss to a minimum of breakeven, or even into profit. If its into the profit point I then take the secured equity into the consideration of the risk on my trade.

 

[perryjohn765]

that indeed is a very good suggestion. one can control the risks and trade longer and better.