Money management and risk control!




There are many systems out there and each trader is using a unique strategy, but there is something common between the successful traders and the one who are losing money and that is the mindset of money management and risk control. To make a profit in trading you have to manage the risk you take. You will always have loses, and you have to make sure that those are smaller than the profits Each trader have some set of rules he follows, they are not something special but following them is crucial to stay in the game. Posted below are my rules, and if I dont follow them I feel like I am gambling

Popular Investor1 - EN

  1. Never risk more than 2,5% of the capital on a single trade. - for small capital that percentage could be higher, but no more than 3,5%
  2. Always use stop loss. - I usually set up my stop loss to be 1,5 lower compared to my targeted profit.
  3. Never over trade - each trade I have a targeted profit and once I reach it just close the position
  4. Never let a profit run into loss - Once the trade became profitable I change the stop loss to be a profit
  5. Always go with the trend - trading is not easy and if I go against the other traders it wont be easier
  6. When you doubt get out! - when I am feeling that the trade is not good or I had a bad entry - just get out

These are my money management rules they are not many, but have get me out of troubles so far!

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