Money Management

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#OPINIONLEADER#


Money management is paramount of any trading strategy. Besides knowing which currencies to trade and recognizing entry and exit signals, the successful trader has to manage his resources and integrate money management principals into his or her trading plan. Position size, margin required, recent profits and losses, and contingency plans need to be considered before

entering the market.


Risk per Trade

When entering a position you then should only risk about 1% to 3% of your capital on each trade. This stops you from getting too greedy and keeps you focused on the process of trading and not about how much money you can make. So if your account has a balance of $10,000 then you should only risk $100 to $300 on a trade. Below displays the impact this can have on your capital between a trader who risks 2% and one who risks 10%. Notice the difference after just 10 trades.


#OPINIONLEADER#

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