At Forex Trading, goal plays a very important role in your journey as a trader. You may want to grow your account or you may want a regular income from Forex, these two things are the deciding factor in what amount of Capital you choose for your account.
The whole trading process depends on the capital available for trading. If is relatively small, the buying power would be limited, so the trader would have less trading possibilities. At the same time, there are some strategies requiring less capital to make sufficient profit. As usual, such strategies have a great risk-reward ratio which is sometimes exceeds 1:10. By the way, if you are looking for the solution to check the risk-reward ratio of the strategy and its performance in long term perspective in general, you can backtest it using special software like Forex Tester that executes simulated trades provided by brokers. After such testing you will understand how your strategy works and thus will be able to know its strength and weakness. Trading goals are important, but it would be better to set goals in the measures of progress and professional development rather than in profit. In this case, you will focus in improvement of your trading process to become consistently profitable.
Working capital is calculated by using the current ratio, which is current assets divided by current liabilities. A ratio above 1 means current assets exceed liabilities, and generally, the higher the ratio, the better. You can also take advice for prestige from Prestige Capital Corporation.
