Tuesday, February 1, 2011

Forex Risk Management

Risk Management 
taken from FXInstructor (FHI ~ Kaskus)
Think about long-term outcome. Do not be fixated on short-term results
Trader patience and discipline and who can manage the MM and the risk-reward ratio is well, probably "lost" by traders who want big profits but quick to ignore the long-term risk management. Traders who think forex is the high road to great wealth, might be able to generate hundreds of percent reward of the week / month by relying on the "holy grail trading system" either by using their own systems or systems which are sold in online web seller while traders wait to just produce a "little" rewards within the same timeframe (short). 
 But in the long term, traders who patience and discipline, and really know how to manage risk in long-term capital was the reply will survive and gain long-term results are much better, while the trader of instant dropping off one by one, where the profit per trade their can produce a car deer in a week, but lost five luxury homes at the end of the year. Whether because of their trading systems no longer match market conditions or their emotions are usually easy to heat and tend to want revenge krn risking too much in a trade. 
 In a book about Soros, I'd ever read that Soros had fired a profitable trader who by reason of not having a good risk management. Maybe Soros knew full well that this can lead to loss of self control and can not guarantee long-term outcome is good. Psychological factors is certainly related to each other and which is far more important than just a trading system. We could'nt control the market, but We can control ourselves.

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