I believe the number one killer of forex accounts has
to be the fact that most traders really don't use sound money management
strategies. I don't care how skillful a trader you
are, if you are constantly overleveraging your account, you have no chance of
Traders (especially new ones) have to understand that
trading is a long term battle. If you put all your eggs in one basket (or trade) hoping
to strike it rich, eventually one huge loss can completely wipe out your account.
First and foremost you should never trade with money
that you can't afford to lose. If you deposit funds in your brokerage account that is meant
to be used to pay for groceries, then I strongly encourage you to think twice about trading
Sadly, this is fairly common with many new
traders. They think of trading as if it was the "gold rush".
Having this kind of mentality is not
only incredibly dangerous to your brokerage account, but it also really lessens your chances
of any kind of success as a trader.
Think about it. Who do you think has a greater
chance to succeed? The trader who is trading with money that he needs to survive with or a
trader who is using supplemental income? Obviously it's the latter, and the only way to do
this is with trading support and
The reason is simple. How can
you clearly focus on trading when you have so much pressure on every trade? When
you have to make money on every trade, your emotions are
going to get involved and pretty soon, you are not trading with your brain, you are trading with
Making money trading the forex
market requires an cool, even headed mindset. Trading should not be exciting. Your
goal should be to act the same whether you make money on a trade or whether you lose money on a
Trading is a job just like anything else. You
have to treat it as such, both in your money management, and how you handle your emotions when you
take a trade. Act as if its any other kind of business
you would venture into.
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