FREQUENTLY ASKED QUESTIONS
Q: How much money do I put on per trade?
A: I personally adjust my position size depending on the currency pair and stop loss difference to cap my loss at a maximum of 1%
Q: How many pips do i look to achieve Daily / Weekly / Monthly.
A: I never set percentage or pip goals, this can cause impulsive emotional behaviour which forces you into taking positions that may not meet your rules to attain the extra percentage / pips required for the Day / Week or Month.
Q: What is my average pip stop loss.
A: My stop loss is based on structure and 4 main indicators and not on pips.
There is a huge misconception when trading a fixed percentage of your capital that the more pips you attain the more profit you accumulate, however i have illustrated above and explained below why this is not always the case.
Let us look at a hypothetical trade example:
Trade 1 - Take profit +1% ( +50 pips )
Trade 2 - Take profit +1% ( +50 pips )
Trade 3 - Stop loss -1% ( -200 pips )
Total:
1% Capital profit
-100 Pip loss
Slippage.
Unfortunately slippage is an unavoidable part of trading where your broker closes your order for a different price than what you set in the initial order form.
Although this is overlooked by many traders it is something that should be taken into consideration prior to any position.
Q: How much money do I put on per trade?
A: I personally adjust my position size depending on the currency pair and stop loss difference to cap my loss at a maximum of 1%
Q: How many pips do i look to achieve Daily / Weekly / Monthly.
A: I never set percentage or pip goals, this can cause impulsive emotional behaviour which forces you into taking positions that may not meet your rules to attain the extra percentage / pips required for the Day / Week or Month.
Q: What is my average pip stop loss.
A: My stop loss is based on structure and 4 main indicators and not on pips.
There is a huge misconception when trading a fixed percentage of your capital that the more pips you attain the more profit you accumulate, however i have illustrated above and explained below why this is not always the case.
Let us look at a hypothetical trade example:
Trade 1 - Take profit +1% ( +50 pips )
Trade 2 - Take profit +1% ( +50 pips )
Trade 3 - Stop loss -1% ( -200 pips )
Total:
1% Capital profit
-100 Pip loss
Slippage.
Unfortunately slippage is an unavoidable part of trading where your broker closes your order for a different price than what you set in the initial order form.
Although this is overlooked by many traders it is something that should be taken into consideration prior to any position.
I will be adding more information to this post in the coming weeks explaining my personally outlook on the topic.