Profit and loss in trading

Profit and loss in trading
Published: 13.03.2022

Only beginners can hope for break-even forex trading. Profit and loss on forex can be said to be a single whole. It is impossible to trade only profitably or only unprofitably, but it is possible and necessary to balance the ratio of profit and loss.
Often one profitable transaction is followed by several unprofitable ones, but the main thing here is not the number of transactions, but the overall financial result.

The key to successful forex trading is competent capital and risk management. The bottom line is that as soon as there are signs indicating an erroneous entry into the market, the transaction should be closed. And when confirming the correct opening of a position, it is necessary to hold the transaction until maximum profit is obtained.
The theory of relativity is not applicable in forex, and you can't count on randomness here. Trading should be conducted exclusively by strict calculation.

A common mistake of novice traders is that they think that every second entry into the market, in any case, will be profitable. But to achieve such a result, it is necessary to conclude transactions only after conducting a preliminary technical. market analysis.

The following recommendations will help you get the optimal ratio of profit and loss:

1. Thoughtful placement of stop loss and take profit.
Take profit should always be greater than stop loss, moreover, this ratio should not be less than 1:1.5.

2. Always plan the amount of possible losses.
The loss should not exceed 5% of the amount of your deposit.

3. Do not delay closing unprofitable trades.
It often happens that after concluding a new deal, the trend reverses, or there are signs indicating the approach of a reversal. In such cases, you should not hope for luck, it is better to close the deal immediately before you incur larger losses.

4. Analysis of your work.
At the end of your working day, analyze your transactions at the end of each month. Calculate the total percentage of profitable and unprofitable transactions, as well as their ratio. This feature is available in MetaTrader 4.

5. The number of transactions.
Do not think that the more transactions you conduct, the better. Focus your efforts not on the number of transactions, but on the effectiveness of each of them.

By following these simple recommendations, you will be able to get a positive financial result at the end of the month. Since you have to set yourself exactly this task, and not getting a one-time profit.

And in order not to risk your own money on the forex currency market, get no deposit forex bonuses, and start earning right now, without investments.

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