Forex Risk Management

Risk Management is a very important objective in Forex trading. Please reply about this one and i will really appreciate to have guideline via this forum.

What is importance of Risk Management for the new comer.

Here is huge information about managing the risk involved and powerful strategy to handle it.Good post.

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on subjects as Forex Risk Management/Money_Management .. and many many more.

 

I humbly recommend .. no financial attachments .. just a very 'Avid Fan' .. sharing

 

http://indo-investasi.com/showthread.php/13480-share-solomonfx

 

Good trading wishes

There are no rules to risk. You can risk whatever you want, risk from 1% per trade to 5% per trade, if you like you could even treat it as a gamble and risk 50% per trade..

 

Personally, I do take fairly big risks with anything I do, so for me it makes sense to use a risk in forex of 5-10% per trade :)

It also depends on how you trade. I do some scalping and every trade is 5% and long term 2% thanks for the ratio.

Strategies to reverse the tides of these risks are demanding for transactions to be settled in hard currency, diversification and hedging. Diversification is a Forex risk management strategy that has to be considered from time to time because it is the nature of currencies to fluctuate in a given period of time.

Here is a nice money management indicator for MT4, on 5 digit brokers you have to add an extra zero to your stoploss. It can work directly off your account balance if you wish.

It works out your tick value, equity risk, lot size & your $/pip value based on on your lotsize.

 

http://www.4shared.com/file/PIGRVc7F/Dragon_Money_Management.html

Forex risk management can make the difference between your survival or sudden death with forex trading. You can have the best trading system in the world and still fail without proper risk management. Risk management is a combination of multiple ideas to control your trading risk. It can be limiting your trade lot size, hedging, trading only during certain hours or days, or knowing when to take losses.

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Edited October 7, 2011 by Mark vough

always use 2% - 5% for target and loss . . this is good MM. .

Forex risk management can make the difference between your survival or sudden death with forex trading. You can have the best trading system in the world and still fail without proper risk management. Risk management is a combination of multiple ideas to control your trading risk. It can be limiting your trade lot size, hedging, trading only during certain hours or days, or knowing when to take losses.

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Forex Market is though tough to play as well for the infant traders. Hence, proper knowledge of the market is important. If you are not sure of any situation, do not invest. It is true that the market is unpredictable, but it does not mean that you should set your all senses aside and move in any known direction. One should always treat the trading like a business. Make some set of rules and try to stick to them at any cost. Being an expert is not a case of few minutes, you would need to spend hundreds or thousands of hours to get favorable results at the end.