When you are trading without proper planning, it is not suitable to manage profits from the trades. On the other hand, with improper risk management, the losses are inevitable. Both of the defective trading approaches we just mentioned are prominent in novice trading. The traders do not have enough information on quality trading. Then they also feel emotional in the trading approaches. The returns from the executions happen to make you emotional. When you will lose money from the trades, your expression will be the same. For the sake of quality trading performance, the traders cannot lose their control over the trades. It does not help to ensure quality trading performance. Proper risk management, market analysis skills and interest in position sizing helps to ensure trading quality. That is why we are bringing this article to the traders which will improve the efficiency of the traders. Moreover, a proper trade setup will be ensured to maintain the trades. You can grow focus on the trading edge when proper information is in your head. So, read this article to learn proper trading and improve an effective trade setup. You need to improvise with risk management To a novice trader in Hong Kong, making profits may be alluring. But it is not an effective idea to improve trading performance. The traders will lose their control over the trades. Moreover, they will also decrease the quality of trading. Your trading mind will try to manage profits anyhow from the markets. For almost any market condition, you will like to place a trade. It is not professional and does not ensure even a decent profit potential from the trades. Instead of making profits, the traders end up losing more from trading account. So, you cannot think of the returns of the trades. Instead of the results, you will need to focus on the trading plans. With the idea of a secured trading business, you need to take care of the risk management properly. It will ensure a secured investment in the trades. Follow a decent money management strategy like 1% risk per trades. With that plan and also using decent leverage like 1:10 for the trades, it is possible to reduce the investment without having too much pressure from the losses. Ensure a proper position sizing for the trades If the traders want to secure their account from the losing trades, they also need to avoid uncertain trading executions. Being desperate to win profits, many traders opt for unplanned trading approaches. Some even try to trade for any market condition. According to the past data of Forex trading, it will only bring unimpressive returns from the trades. You will lose a lot of trading money from the trades. If you can take care of the trading approach properly, it is possible to deal with the losses. For that, try to trade with a proper position sizing. Using decent risk management and profit target, try to define the best position sizing for the trades. After you have set the necessary entry and exit points to fulfill the pips gain, trade according to the market condition. Unless you have a proper price movement, you cannot place a trade. It will prevent you from being infected from the inside and help you save a lot of capital. So be a wise trader to trade less also try to follow a proper trading method which can help you stay consistent and a less frequent trader. Select a proper trading method to be consistent With a proper trading method, the traders need to stay consistent. According to the experts, the traders cannot ensure good quality trading unless they are disciplined. You will need another thing to be consistent and efficient in the trading business. Without reducing stress in the trading process, it is not possible to plan properly. So, the rookies need to select the day trading instead of scalping so that, their trades are less frequent. Also, it will help them to plan for a proper position sizing of the trades.
All aspects of trading process you`ve mentioned are important for tradres. Proper risk management allows trader to reduce risk ant prevent unexpected losses. In fact, many traders fail just due to the wrong approach to risk management: the expose their accounts to the risk higher than they could afford. That is why it is so important to pay enough attention to such details as risk per trade and position size calculation. For exmple, it is better to calculate position size and stop level each time making a trade instead of using fixed stop size since it would give more flexibility that could be very important during high volatility period. By the way, traders quite often forget that volatility could change, so they will have to make changes to their strategy to keep it profitable. Sizing is very complicated technic even for experienced traders. Wrong sizing could lead to huge losses. The main sizing rule is that each part of the position should be opened and closed as independent position. Thus, it would be necessaryto find proper entry points to add to the position. As it was mentioned before, each trader should focus on consistency first. The result of one particular trade is not so important as the final result of a week or a month. That is why the main goal should be to become a consistently profitable trader rather than just to get huge profit.
When people see the term "traders" they automatically think high risk gamblers but this is not necessarily the case. Successful traders will know when to take a calculated risk, use downside protection and never overstreth themselves. Run your winners and cut your losers.
