Without good quality strategy, Money and risk management is USELESS - Page 74
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Thread: Without good quality strategy, Money and risk management is USELESS

  1. #1
    Registered user Lyon's Avatar
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    Without good quality strategy, Money and risk management is USELESS

    In forex trading we are been taught of money management, of course!, we need to have good money management so that we don't loss all our money in the market.

    Money management is the rightfully investing of the amount of money you can afford losing. Which means, if you have $10,000 to your name, meaning that is all the money you have, you should be wise enough not to invest all, that means, invest 10- 40 percent of it, which is $2000-$4000. You still have some money left. That way, you don't loss your shirt.

    Risk management is risking the right amount of money on each trades. Some will argue that you don't take more than 2 percent risk per trade. That means if you have $1000 capital balance, if you are to buy EURUSD, your stoploss should not exceed a total dollar value of $20 which is 2% of $1000.

    So when you loss even 5 trades on a role, you only lost 100 because $20x5=$100. So you loss less right?

    But all those above illustration on money and risk management are all useless when you don't have a strong quality trading concept/strategy and discipline.

    Therefore my message is that, we need to pay more attention to mastering and learning a good trading strategy and discipline because then we can reduce the losing trades we will take and that will help our money and risk management protect our account.

    Because when your strategy is wack and you lack discipline, you will only loss slowly but surely you will loss all funds.

    Hope this helps change the way we trade.

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    Registered user sniper007's Avatar
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    All these are requirements to become a successful trader, so in a nutshell, every one needs to have a trading strategy that they will make use of, also on the other hand, a good trading risk management will also help the trader to get to handle the trades they have taken. You being successful trader is a thing that we have to acquire so many skills.

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  3. #732
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    allow me to disagree with you . bro . In my opinion whatever the strategy is weak and not proper . the money management remains has the most effective way to achieve good profit . so i think also that the right money management which helps in protecting the balance from being violated . and then there can be very good chance to compensate what the weak strategy lost by the good money mangement

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    Registered user cutiekc's Avatar
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    Quote Originally Posted by Abhishekwala View Post
    Both are needed, a strategy should be supported with risk management so that we dont become victims to heavy drawdowns and losses. Further when we have a strong strategy, we also need a strong deposit to make the most of it by following risk management. Discipline is very much important it took me lot more time after knowing the importance of risk and money management to actually start following it strictly in trading.
    That is right, once we have both of them and then we can make good use of it, I think we can become profitable. Those who don't have a complete discipline to the way they make use of the money and risk management, I don't think they will get to become profitable. But then again, I will support we spend more time in having a stronger strategy.

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  5. #734
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    Quote Originally Posted by cutiekc View Post
    That is right, once we have both of them and then we can make good use of it, I think we can become profitable. Those who don't have a complete discipline to the way they make use of the money and risk management, I don't think they will get to become profitable. But then again, I will support we spend more time in having a stronger strategy.
    if we do not have discipline we can not get success this is reality and a simple step, actually our rules define what is better and how much we can lose or earn from single position so never think about many orders at a time, move slowly when we place more and more orders we lose our discipline we start to lose own money as well, so make sure you are not doing this, you should do some proper trade with rules

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  6. #735
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    My experience when it comes to money management is that its what will give us great potential to survive and still have the opportunity to seek for a profitable trade. Risk management is not useless when you think you have a good system because sooner your system will fail you and it's only when you have a good risk management that could survive that loss. I always give my best to manage my investment because I know I can't become better if I don't manage my risk.

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  7. #736
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    Quote Originally Posted by Tonycee View Post
    My experience when it comes to money management is that its what will give us great potential to survive and still have the opportunity to seek for a profitable trade. Risk management is not useless when you think you have a good system because sooner your system will fail you and it's only when you have a good risk management that could survive that loss. I always give my best to manage my investment because I know I can't become better if I don't manage my risk.
    Further risk management helps us to avoid stress and remain calm during trading and this will facilitate better decision taking. Further our psychology has a huge impact on our trading and so to keep our trading meaningful and on the right trade, we need to fine tune our psychology. If we do some mistake then we face loss and the first thing we should do is learn from that mistake.

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    Registered user sniper007's Avatar
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    We all are looking towards how we can become profitable trader in such a way that we get to trade the market in a profitable way. In a nutshell, we need to make sure that we have good money and risk management that we are making use of. A good trading strategy is needed and is one of the most important thing that we all should ensure we have got.

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  9. #738
    Registered user Toyen's Avatar
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    Quote Originally Posted by naeem555 View Post
    if we do not have discipline we can not get success this is reality and a simple step, actually our rules define what is better and how much we can lose or earn from single position so never think about many orders at a time, move slowly when we place more and more orders we lose our discipline we start to lose own money as well, so make sure you are not doing this, you should do some proper trade with rules
    Discipline is good for trading, and as much as discipline is good for trading, it can not be working rightly for traders without the trader is patience likewise. I believe that many things are making traders to achieve their goals of trading, one one them is the discipline you made mention. But traders needs more of good strategy and management before they can ever be making success in the market.

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  10. #739
    Registered user mexima's Avatar
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    Quote Originally Posted by Toyen View Post
    Discipline is good for trading, and as much as discipline is good for trading, it can not be working rightly for traders without the trader is patience likewise. I believe that many things are making traders to achieve their goals of trading, one one them is the discipline you made mention. But traders needs more of good strategy and management before they can ever be making success in the market.
    discipline is as same as you express in the class room if you don't have discipline all class will be mess up as same in the forex account and that mes in the forex will blow your account how ever if you have good method and strategy then you should add discipline on that as well which will make your strategy more perfect and efficient .

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  11. #740
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    Money management is one of the most important keys to become profitable, so therefore, unless we have learned and know how to make good use of it, then the better for us, then the best we can become profitable. But then again, just like I have learned a good trading strategy is always important, we all should have it. develop a good trading strategy and then experience the good side of the business.

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