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Investing or trading in the financial markets successfully, carry many unique characteristics. What stands out and continues to be an important ingredient to long term profitability, is understanding and implementing strict money management techniques. Take the steps to utilise this information, which aims to enhance your existing or new portfolio.
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© 2012 Smart Forex Education
Presents
RISK MANAGEMENT
© 2012 Smart Forex Education
The Forex market is driven by the Emotions of traders. These include F E A R & G R E E D .
© 2012 Smart Forex Education
Preparation
Confidence
Adhering to your plan
Adaptable
Decision Making
© 2012 Smart Forex Education
Forex Risk Management Calculator
Money Management Calculator
Account Type Micro Account Balance $ 1.000,00
Lot Value $ 1.000
Currency Pair EUR/USD Risk % 2%
Pip Value $ 0.100 Capital at Risk $ 20,00
Stop Loss (Pips) 50 Position Size
(Lots) 4,00
Stop Loss Value $ 5,00 Position Value $ 4.000,00
True Leverage 4,00:1
Note: Contact me to receive the excel version to make changes to the input fields. © 2012 Smart Forex Education
SFE Risk Management Options
Different risk management scenarios:
1. Stop and one target.
2. Trailing stop.
3. Fixed stop and scaling out of postions.
4. Trailing stop and scaling out of positions.
© 2012 Smart Forex Education
Stop and One Target
This risk level involves placing a stop with one exit target:
Price action in a tight range (consolidation).
Low SFE setup ratio.
Fundamental news.
Income generation.
© 2012 Smart Forex Education
Trailing Stop
Trailing stop involves trading:
In the direction of the long term trend.
SFE setup high.
Long term fundamental news.
Wealth management strategy.
© 2012 Smart Forex Education
Fixed Stop and Scaling out of the position
Fixed stop and scaling out of postions:
Short term trading setup is in place.
Market lacking long term direction.
25% of your capital scaled out at predefined levels (using technical analysis).
© 2012 Smart Forex Education
Trailing Stop to Breakeven & Scaling Out of Positions
Trailing stop to breakeven and scaling out of positions :
Focused on trailing stop to breakeven.
Minimizing loss.
Reducing downside risk early.
Short term trades.
Multiple trading opportunites.
Income generation. © 2012 Smart Forex Education
© 2012 Smart Forex Education
Overall Capital Risked
Per Trade
1% Risk Per
Trade (Low)
4% Risk Per Trade
(High)
2% Risk Per Trade (Medium)
© 2012 Smart Forex Education
High Risk Trade 1% Account
SizeMedium Risk
Trade 2% Account Size
Low Risk Trade 4% Account
Size
0%
20%
40%
60%
80%
100%
Probability of the trade –Percentage risk per trade
© 2012 Smart Forex Education
Trading Template
Note: Contact me to receive the excel version.
Entry time Position
Strategy
# Ticket Lot size Forex
Entry price Stop Limit
Exit trade
Exit price Pip P/l
Total pip P/L Evaluation
© 2012 Smart Forex Education
© 2012 Smart Forex Education
© 2012 Smart Forex Education
© 2012 Smart Forex Education
© 2012 Smart Forex Education
© 2012 Smart Forex Education