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Actually money management is also one of the important part of the trading in forex, because everyone wants to know about it,as i am the newbie and therefore i also not know about the money management calculation process, share it with us also if you have knowledge about it. Money management is an important point in forex market. different trader take different strategy to mange the money. if you have $100usd you lot size may be 0.16 or 0.1. you can take risk.
Money management contains : percentage risk (better is maximum 2% till 5%), stop lost or cut lost, and lots size. Here is examples :
Capital $100, risk 2%, stop lost choosen is 50 pips then we can calculate the lots size is :
Capital/risk = $100/2% = $2.
Lots size = (capital/risk)/stop lost.
= $2/50.
= 0.04. or 4 cent per pips.
After watching the last few months since becoming a trader, it turns out there are a trader behavior that have misguided perceptions about the world of trading. For a trader who recently jumped into the world of trading, sometimes they see that the world trading is a way in which to become rich instantly, then plunge it into it without having reasonable grounds for his own.
The money management calculation totally depends upon the individual investment capital and the extent of risk taking because various traders plans the strategy according to their target and thus the money management also differs.
Trading on the forex market can be a very profitable business. So some traders start determined to make huge sums of money in as little time as possible - by risking too much. In other words, they are aiming for fast geometric growth of their accounts with no regard for the smoothness of the equity curve. Only Best money management solve this issue.
Bro nice post sab se pehle to aap ko ye decide krna hoga ha aap kitna risk le skte ho ziada tar trader risk ration 10% rkhte hian her trade me,abhi apna lot size or stop loss aise set kro ko aap ko sirf 100$ ka 10% hi loss ho is se ziada nahi ho to aap ko sirf 10$ ka loss hoga agr hoa bhi to or profit aap apni strategy k mutabik earn kr skte ho:good:
money management calculation very important because if you read about the successful trader and the survivor you will find that all of them manage their money and they calculate the risks per trade about 5% because we need to save part of the capital using it to recover or solve any loss floating
Forex is fully money business. Most of thing are related to money, so we must smart to manage our money and surely we need a proper management for that purpose. This is usually called money management.
My advice, in trading that takes self-control and money management is good, because it would be nice if the business is done with the process, both the development of capital and the quality of our own trading. so you can bet we will be able to survive in this business
for me, money management should we calculate depend on the experience we have during trading it self, mroe experience we are we will make more better money management and the money management also should can make our trading account be survive on any condition of the market it self