More risk, more profit: is it true? -
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thread: More risk, more profit: is it true?

  1. #21
    The one's who think Forex is simple are noobs or don't have any clue regarding what currency trading is all about. The truth is that it's anything but easy..and as because of its high risk, additional profits - yes although the chances of incurring heavy reduction goes up as you raise the risk. .

  2. #22
    Junior Member xavi__12's Avatar
    12
    If your Machine has a positive expectancy Usage up to the Quantity defined by the Kelly criterion http://en.wikipedia.org/wiki/Kelly_criterion

    If your system has a negative expectancy Afterward risk zero (Demo)

    Simple:--RRB-

    BBCMirco

  3. #23
    Member Jttep's Avatar
    84
    This is very untrue. Please not believe like this, it will make you not best trader. There is always risk, no. If you needing or thinking no risk, please eliminate the trading. If you're the good trader that can be made the more profit and minimize the risk, by making and using the smart trade setups. Okay I hoping you being helped by this , no.

  4. #24
    It is only if you risk more, you can gain more.

  5. #25
    Junior Member Moktalat's Avatar
    21
    It's the same with most things in life, the risk is proportionate to the possible reward/loss.
    Basically, it is a matter of loing the highest level of risk with which you and your account will be comfortable, and also gives a suitable yield.

    Those stating the smallest risk has the highest reward have a point in a greater risk is likely to relieve you of your balance earlier. However, this all depends on the system being traded.

    Say by way of example you have a system with these assumptions (BTW: if anyone does, please let me know!) :
    - Max 1 commerce open anytime
    - S/L T/P at /- 100 pips
    - Wins 60% of trades

    depending upon your attitude to risk you can tune your lot sizes such that every trade's vulnerability is 10 percent of your account balance, in concept this would leave your equilibrium at approximately 10%.

    But we have to be mindful of the fact that we are in the Actual world, and even this ideal system's 6/10 winning trades may not all happen at the same time, for example you could have the next 30 trades:
    | LOSS | LOSS | LOSS | LOSS | LOSS | LOSS | LOSS | LOSS | LOSS | LOSS | WIN | WIN | WIN | WIN | WIN | WIN | WIN | LOSS | WIN | LOSS | WIN | WIN | WIN | WIN | WIN | WIN | WIN | WIN | WIN | WIN |

    The machine would be performing as promised with 18/30 (or even 6/10) wins.
    However, had you enabled each transaction 10% exposure to your account, you would have been wiped out after the first 10 trades.
    This is an extreme example, but it indies a competent system needs appropriate money management.
    Had you alloed only 1% to each trade, you would see these advantages:
    A) You have sufficient time to spot any weaknesses in the system, after the initial 10 losses, perhaps you've seen something it could do better.
    B) You provide your system much more chance to be successful, sure it may win the first 6, but far more likely it'll require a longer time to prove itself.

    So many potentially excellent traders empty their accounts as a result of poor MM till they realize they had been on to something!

    Anyhow, enough rambling from me

  6. #26
    Member Jttep's Avatar
    84
    It is only if you risk more, you can profit more.
    No. Much like that. It's possible to gain more rather than risk more if you waiting for trade setup that is the best. Please, hope you know. Ok today I begin own journal and show you, no.

  7. #27
    Greater risk and more profit
    maybe people would like to listen to more profit and depart the risk
    high risk is almost the same as gambling, in my opinion the keys is the way to decrease the risk on every position we made

  8. #28
    Lets take a case.

    If you risk 1% of your account maximum. It's very unlikely that you will make 100% in one month, but it's highly likely you will not bust your account.

    If you risk 10-50percent of your account, earning over 100% profit in one month is more than possible. But you are most likely to blow off your account sooner or later.

    Conclusion, more you risk higher the odds of making larger profits.

  9. #29
    Member lcoco's Avatar
    38
    I've discovered that I can not stomach even half the drawdown I believed I could.This affects a lot for me personally.
    I can not become rich fast from fx.Infact I've thought of stopping altogether. I can not imagine playing 2-3% per month, together with the capital I've its worthless. It will take me'millennia' to make a good roll.

  10. #30
    I Enjoy controlled risk and consistent profit

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