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Risk Management in Forex

In Forex financial mareket, Risk management has a lot of importance as it could either lead to the survival or death of the trading. <br><a href="https://howtostartforextradingonline.wordpress.com/2018/08/16/risk-management-in-forex/" > Visit our Blog </a><br>

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Risk Management in Forex

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  1. Risk Management In Forex Platinum Trading Institute

  2. Risk Management in Forex • Risk management has a lot of importance in forex trading. • It could either lead to the survival or death of the trading. • Risk management includes certain measures for containing loss in trading. The measures could become downsizing the quantity of trading, introduction of hedging, or trading only during certain hours or days in a month, or knowing in advance about the losses.

  3. Forex Risk management- Why important? • Proper risk management teaches the trader the intricate art of survival. • Although brokers always encourage the traders to take large risks and earn large gains, such prompting simply diverts the traders’ attention from the inherent risks of trading.

  4. Exercise control over losses • Exercising control over losses is certainly a wise step. • Make use of correct lot sizes: The broker’s advertisement might make the trader think that it is possible to open an account with $ 300 balance and make use of 200: 1 leverage in order to open mini lot trades of 10,000 dollars that would bring the trader just double the money in return in a single Forex Trade US. But this could become utterly delusive. The reason is trading does not have any formula that would work in this magical way. 

  5. Know the overall exposure • Although using smaller lots is important, it would not even help when you have too many smaller lots. • To add to it correlations between important currency pairs carries more weight. • To reduce risk learn more about risk management at Platinum Trading Institute. • When a trader falls short of EUR/USD and goes long on USD/CHF, he/she gets the exposure twice to the USD and goes in this direction. But it comes to using USD twice and when the value of USD falls, it doubles the loss of trader.

  6. Thank You.

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