Indeed big risk can give birth to big losses , therefore one must risk only a small amount on a trade so even if there are losses, they are not so big and a trader can manage it easily.
Yes, it is one of the main rules of risk management - your profits when you win should exceed your losses when you loose. So, according to the proper risk management approach, you should earn more than the amount you risk with otherwise your profit expectations would be negative in long term perspective. As usual, traders use 1:3 risk-reward ratio, but it could also depend on the particular strategy. For example, scalpers could use even 1:1 risk-reward ratio just because they have a great win rate, while swing/mid-term traders often have 1:7 - 1:10 risk-reward ratio allowing them to make numerous mistakes but stil be profitable. So, if you want to succeed in trading, you should develop detailed risk management and also money management rules that would fit your trading style and financial goals. Another important point is that it is necessary to use stop loss orders to prevent the account from huge losses. As the professional traders often say: "Cut your losses quick, let your profits grow". Accroding to this statement, you should close losing trades as fast, as possible (in fact, it is better to close them when you understood that the initial scenario is no longer valid) while holding profitable positions long enough to get subtsantial profit.
I totally agree, your word is very true. Sometimes the field is so tempting. To which we are attracted and make big mistakes. But for now, in my opinion, the People buy Instagram account carries the best risks of today's societies. Good to be able to act like them and start from the beginning instead of starting from the big ones.
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A big risk can easily bring big losses for you. You have to trade always with perfection so there will be less chance of losing money. Risk in a forex market is a very simple issue. I always try to avoid risk. I trade with Eurotrader. They are a very reliable broker. They never make disappointment to their client. They always provide the best service. They take no additional charges while withdrawing money. They are very supportive.
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