Risk management

The most important information to have in my opinion is risk management. Below are some things to consider around risk:

• How much risk per trade?

• How much risk per day?

• How much risk per sector?

• How much risk in correlated Forex pairs?

• How much overall risk exposure?

• When do you make your trades risk free?

• How many times will you compound?

Are there certain market environments where you’ll be trading with reduced risk?

All of the above need serious consideration when you’re developing or learning a new strategy. They are all personal preference dependant on you own risk tolerance. Nobody enjoys losing money, but realistically how much are you willing to lose in one go? If you can’t sleep at night with 16% of your account at risk then drop your total risk exposure to 10% or less.