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Hello Every one !
I have just make this thread to answer the novice trader as you know many trader sometime not understand leverage lot etc so here i invite every expert that when ever a novice trader comes here can ask question from expert and we will try to give best answer
best regards
Note:This thread is solely for the purpose of the question/answer, members may can reply others question or can ask question.
Last edited by Gamer; 10-15-2013 at 02:07 PM.
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I want to ask how to calculate what percentage of our capital that can be used for trading. I mean trading for a beginner to me, not by scalping strategy. Because as a beginner I have not been able to count properly, what percentage of our capital, and able to withstand loss how many pips. How ideally to take profit and stop loss? Thanks for your answer.
Last edited by Gamer; 02-09-2013 at 09:18 PM. Reason: spelling mistake
#3
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You are welcome in our welcome :Originally Posted by mamamerana
How much percentage you want to use for the trading or per trade it's quite different .
Find out first how much maximum your draw down per single trade , What's draw down, it's negative floating after exection of the order . Very important to know it always .
Once you know what's your maximum draw down then easy to determine what's Percentage of the risk per trade is vaild maximum .
let's start you start the trading with fund 1000$ , you took 0.01 or 0.1 ( 1$ per pip ) , now lets say maximum draw down per trade which you face is 5% which means probably after 50 dollars minus float you will start getting the profit , but further what's you can do is also that looks for the last higher or lower add 10 pips more and then divide by this way so you can easily determine lot size , but it's then directly depended how much risk per trade you want . So these are two different way to manage the risk via percentafe too.
If you are a beginner the best thing you can do , let's open the demo account and try out your ideas on it , because only the demo will show you , what's skills you have and how much improvement you need.
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I am always using one percent of total capital per trade this is my first step. but sometimes market condition and economical events encourage me for increasing volume. specially NFP and Bank interest rate always encourage us to take risk. and my draw down does not cross 15%.
Don't loss you hope.
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The stop order amount without of margin must be stayed within the risk interest – meaning 1-2%
Here is an example of the formula for the lot calculation:
lot = (X: SL = PV) * 10 000
X = the amount of money we are willing to lose within the deal
SL = the stop level in points
PV-point value, which is to be multiply by 10, 000 for to have the required item as a result.
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Good formula in my view, you are a pofessioan up could make a nice simple formula and can be run to account for the lot in order to really accurately
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This is good calculation, and usually this is called Margin/Money Management (MM Rule)
another MM calculation is we need to decide Maximal Risk first:
(%Risk/100) * Equity
and then calculate maximal lot to trade.
(Max Risk / SL Pips amount) / 10
For examples (STANDARD ACCOUNT):
Equity = $250
SL = 50 pip
% Risk = 5% per OP
How much maximal lot use for every OP?
Max Risk:
..... (5/100)*250 = $12.5 --> $13 <--- meaning, if that OP hit SL, it only loss $13
Maximal lot to trade:
..... (13/50)/10 = 0.025 ---> 0.03 lot <--- max lot and don't make any OP before last OP closed.
If we usually open 3 trade in current same time, so 0.03/3 = 0.01 lot for every OP
* Not for GOLD & SILVER & Cent Account
Last edited by Gamer; 08-20-2013 at 08:23 PM.
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[lang=ar]The biggest help could make to Novice in the forex market is that the training and quality education and must possess trading strategy good and should not be traded in the forex market without the training and education enough and long enough and must learn at the expense of Demo for a period of not less than a full year[/lang]
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The biggest help always come from the training and education which is gained during the phase of trading,the possess of trading knowledge must be the requirement for success here,good or bad trading can be known from the training and education,you need to learn more about it.
Finally successful traders
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Forex big sea and we are still learn whatever we got to the high degree of professionalism of trading, but there is a lot we still do not know the best way to learn is to follow others and benefit from their experience and skill, and continued assistance of everyone in the forum .. I think that the most important points that must be learned by rolling beginner explain sufficient for the size of the lot it differs from platform to another, depending on each company and this is very important to have suffered losses in early trading because of this
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