How Good Is Your Risk Management?

As the Brexit Referendum looms, it seems an apt moment to write something about Risk and Risk Management.

BrexitThe UK Brexit Referendum is clearly a High Risk news event and probably far to close to call at the moment, whatever your view.  Other High Risk news events include General Elections, the monthly Non-Farm Payroll (normally the first Friday of every month) and also other events such as the minutes from the Federal Open Market Committee and BOE Minutes and Interest Rate Decisons by Central Banks various.

As a trader you need to be aware of such High Risk events and conduct your trading accordingly.  The last thing you need to do is expose your trading account to too much risk in the run up to such often highly volatile events.  Better to scale back or not trade than to essentially toss a coin and become in effect a gambler.

There are many ways you can control your risk when trading: Continue reading

0

To Trade or Not to Trade?

(With apologies to William Shakespeare in this 500th anniversary year!)

ShakespeareTo Trade or NOT to Trade?

To Trade or NOT to Trade, that is the question;

Whether ‘tis nobler in the mind to suffer

The drawdown and losses of unplanned impetuous trades,

Or to wait with patience for higher probability setups,

And then to plan and trade them with discipline and calm,

Whilst managing your Risk and being focussed on the process,

And as a consequence, reap fine rewards for one’s labours!

Continue reading

0

Forex Trading – The Essentials

Forex Trading Essentials - www.ForexTradingLondon.comWhilst doing some Housekeeping in my email account, I came across and was reminded of an email I had sent as a reply to a prospective student, who unfortunately could not afford our Personal Mentorship Programme (PMP) lessons.  In my reply I wanted to be helpful, so I tried to summarise the Key areas that he should work on until he was in such a position to be able to take advantage of our PMP.   Here is the main body of the email, with a few additional tweeks, containing what I suggested:

‘No problem, the key things you need to concentrate on are: Continue reading

0

Trading around a Day Job

Whilst helping my former forex trading mentor at a recent World Money Show (London) ‘Divergence’ Trading Workshop, the issue of trading around a Day Job came up.  Not surprisingly, most people learning to trade have a day job.  Some wish to generate additional income on top of their annual salary and others want to eventually replace their current income with an income from trading the financial markets.  We always recommend that aspiring traders in the latter category should NOT give up their day job until they have an extended track record of profitability and sufficient trading capital to be able to generate a decent income, equal to or better than their current salary.  So how does one trade and still maintain a day job?  Continue reading

0

How Much Money Do I Need To Be Able To Start Trading Forex?

A very common Forex related question is ‘How much money do I need in my Forex Trading Account to start trading with?’

My initial response is often ‘Have you earned the right to trade a Live Account in the first place?’ Now that may well sound a little pompous but to me there seems little or no point in trying to trade Forex in a Live Account until you have demonstrated that your chosen strategy actually works and that you are disciplined enough to make consistent profits in a Demo Account first.

Agreed that there are big differences between trading a Demo and a Live Account mainly around controlling emotions such as Fear and Greed, but why enter the Live Markets if you haven’t yet established whether or not you have a definitive edge?

However, once you have demonstrated a consistently profitable track record in a Demo account (3 – 6 months or even a year to 18months) then you do need to think about how much money you need to start with.  This is my advice: Continue reading

0