Forex for a trader
What is total profit in forex

What is total profit in forexForex Taxation Basics. For beginner forex traders, the goal is simply to make successful trades. In a market where profits – and losses – can be realized in the blink of an eye, many investors just want to "try their hand" before thinking long-term. While forex can be a confusing field to master, filing taxes in the U. S. for your profitloss ratio can be reminiscent of the Wild West. Here is a breakdown of what you should know – even before your first trade. For Options and Futures Investors. Forex options andor futures are grouped in what are known as IRC Section 1256 contracts. These IRS-sanctioned contracts mean traders get a lower 6040 tax consideration. This means that 60% of gains or losses are counted as long-term capital gainslosses and the remaining 40% as short term. The two main benefits of this tax treatment are: Time Many forex futuresoptions traders make several transactions per day. Of these trades, up to 60% can be counted as long-term capital gainslosses.

Tax Rate When trading stocks held less than one year, investors are taxed at the same rate as their ordinary income. When trading futures or options, investors are taxed at a 23% rate (calculated as 60% long-term x 15% max rate + 40% short-term rate x max income tax rate). For Over-the-Counter (OTC) Investors. Most spot traders are taxed according to IRC Section 988 contracts. These contracts are for foreign exchange transactions settled within two days, making them open to ordinary losses and gains as reported to the IRS. If you trade spot forex you will likely automatically be grouped in this category. The main benefit of this tax treatment is loss protection. If you experience net losses through your year-end trading, being categorized as a "988 trader" serves as a large benefit. As in the 1,256 contract, you can count all of your losses as "ordinary losses" instead of just the first $3,000. Which Contract to Choose. Now comes the tricky part: deciding how to file taxes for your situation. What makes foreign-exchange filing confusing is that while optionsfutures and OTC are grouped separately, you as the investor can pick either a 1256 or 988 contract.

You have to decide before January 1 of the trading year. IRC 988 contracts are simpler than IRC 1256 contracts in that the tax rate remains constant for both gains and losses – an ideal situation for losses. Notably, 1256 contracts, while more complex, offer more savings for a trader with net gains – 12% more. The most significant difference between the two is that of anticipated gains and losses. At most accounting firms you will be subject to 988 contracts if you are a spot trader and 1256 contracts if you are a futures trader. The key factor is talking with your accountant before investing. Once you begin trading you cannot switch from 988 to 1256 or vice versa. Most traders will anticipate net gains (why else trade?) so they will want to elect out of their 988 status and in to 1256 status. To opt out of a 988 status you need to make an internal note in your books as well as file with your accountant.

This complication intensifies if you trade stocks as well as currencies. Equity transactions are taxed differently and you may not be able to elect 988 or 1256 contracts, depending on your status. Keeping Track: Your Performance Record. Rather than rely on your brokerage statements, a more accurate and tax-friendly way of keeping track of profitloss is through your performance record. This is an IRS-approved formula for record keeping: Subtract your beginning assets from your end assets (net) Subtract cashdeposits (to your accounts) and add withdrawals (from your accounts) Subtract income from interest and add interest paid Add other trading expenses. The performance record formula will give you a more accurate depiction of your profitloss ratio and will make year-end filing easier for you and your accountant. When it comes to forex taxation there are a few things you will want to keep in mind, including: Deadlines for filing : In most cases, you are required to elect a type of tax situation by January 1. If you are a new trader, you can make this decision before your first trade – whether this is in January 1 or December 31. It is also worth noting that you can change your status mid-year, but only with IRS approval. Detailed record keeping : Keeping good records (and backups) can save you time when tax season approaches. This will give you more time to trade and less time to prepare taxes. Importance of paying : Some traders try to "beat the system" and earn a full or part-time income trading forex without paying taxes.

Since over-the-counter trading is not registered with the Commodities Futures Trading Commission (CFTC) some traders think they can get away with it. Not only is this unethical, but the IRS will catch up eventually and tax avoidancefees will trump any taxes you owed. Trading forex is all about capitalizing on opportunities and increasing profit margins, so a wise trader will do the same when it comes to taxes. Whether you are planning on making forex a career path or are interested in simply seeing how your strategy pans out, taking the time to file correctly can save you hundreds if not thousands in taxes, making it a transaction that's well worth the time. What is a Lot in Forex? Choosing The Best Forex Lot Size For Trading. Discussion Topic: Forex Lot Sizes. In the previous article you have learned about Pip and Pipette in forex trading. In this article, you will learn what is a Lot in Forex? What are the lot sizes in forex trading ? How to choose the best forex lot size for trading? And how to calculate your total profitloss using lot sizes?

What is a Lot in Forex Trading? In the past and even presently in MT4, spot forex is traded in specific amounts called lots. A lot in forex trading is basically the pre-defined number of currency units you will buy or sell when entering a trade. Here is a list of different forex lot sizes you will encounter in your trading career. Forex Standard Lot = 100,000 (100K) units of base currency. Forex Mini Lot = 10,000 (10K) units of base currency Forex Micro Lot = 1,000 (1K) units of base currency Forex Nano Lot = 100 units of base currency. Below table shows some more detail about forex lot size: We hope that from above you have got an overview of what is a lot size in forex trading. Now its time to dig down a bit into the different lot sizes to know their currency value. The size of a standard lot in forex trading means 100k units of your account currency. That's a $100,000 trade if you are trading in dollars. If you have a dollar-based account, then the average pip value of a forex standard lot is approximately $10 per pip. That means if you are trading a standard lot, then a 10 pip movement in the market will give you a $100 profitloss depending on the direction of movement. It is recommended to trade in forex standard lot size only if you have $25,000 or more in your trading account. The size of a Mini Lot in forex trading is 10,000 units (10K units) of your account's currency.

If you have a dollar-based account, then the average pip value of a forex mini lot would be approximately $1 per pip. I know $1 per pip looks like a small amount, but sometimes forex market can move over 100 pips in a day, which in turn would be a profitloss of more than $100 within few hours. For trading in forex mini lot size, the recommended account value which you should have is at least $2000. If you are a beginner then we'll advise you to avoid ordering mini lots while trading. Before the nano lot came into the picture (before a few years), micro lots were the smallest lot size a forex broker used to offer. The size of a Micro Lot in forex trading is 1000 units (1K units) of your account's currency. If you have a dollar-based account, then the average pip value of a forex micro lot is approximately 10 cents per pip. If you are a beginner and serious about live trading, then it is highly recommended to trade forex only in micro lots. The recommended account value for trading in forex micro lot size is in between $200 to $500, depending on how many pairs you would trade. You may also make use of the leverage to trade more. See Also: What is Leverage? and How to properly Use it? The Nano Lot in forex trading is the smallest forex lot a broker can offer in today’s market. But be noted that not all forex brokers offer to trade in forex nano lots. Most of the brokers offer up to forex micro lot only. The value of forex nano lot is 100 units of your account's currency. If you have a dollar-based account, then the average pip value of a forex nano lot is approximately 1 cent per pip. You may start this type of account with as low as $25 only.

Trading in the forex nano lot size is recommended only if you are going to test some new strategy in the live market. Instead, we’d suggest using a demo account. How to Calculate Effective Pip Value using Forex Lot Size: In forex trading, It is very important to note that lot sizes directly affects the risk you are taking. Hence, finding a suitable forex lot size for your trade can help you lock down the amount of risk you would be taking. We already learn about how to calculate the value of 1 pip Refer: Calculating 1 pip value. Now we will discuss on how to calculate the total pip movement value using the lot size. For our examples shown below, let’s assume we will be using the standard lot size (100,000 units) and the micro lot size (1000 units). We will now calculate some trade examples to see how it affects the pip value. If USD is base currency: Trade01: USDCHF = 1.3825 1 Pip value: (0.0001 1.3825) = $0.00007233 1 pip value for forex standard lot size: $0.00007233 x 100000 units = $7.23 1 pip value for forex micro lot size: $0.00007233 x 1000 units = $0.0723. Trade02: USDJPY=111.36 1 Pip value: (0.01 111.36) = $0.0000897 1 pip value for forex standard lot size: $0.0000897 x 100000 units = $8.97 1 pip value for forex micro lot size: $0.0000897 x 1000 units = $0.0897.

If USD is not the base currency: Trade03: EURUSD=1.1758 1 Pip value: (0.0001 1.1758) = 0.00008504 EURO 1 pip value for forex standard lot size: 0.00008504 x 100000 = 8.50 EURO 1 pip value for forex micro lot size: 0.00008504 x 1000 = 0.0850 EURO 1 pip value in USD for standard lot would be 8.50 EUR x 1.1758 = $9.99 1 pip value in USD for micro lot would be 0.0850 EUR x 1.1758 = $0.0999. As seen above, forex lot size directly impacts your account in a proportion of how much the forex market moves. A 50 pip movement on a smaller lot size will have much less effect than a fifty pip move on a higher lot size. Forex Lot - The Conclusion: Most retail forex traders only trade in forex mini lots or forex micro lots. It might not sound very attractive, but practically, keeping your lot size small will help you to survive long term. In our opinion, the forex mini and micro lots are the perfect balance between capital requirement and risk-taking. Using higher lot size for forex trading, with a lower capital in the trading account may end up as a disaster. If you are a beginner, our suggestion is to trade mostly in forex micro lot size, and probably in forex mini lot size as the confidence grows. Also, be sue to maintain adequate balance in the trading account and use proper stop loss & target. We hope that you have enjoyed the above article explaining the lot Size in forex trading. Be with us to explore forex trading, stocks trading, and other money-making opportunities.

Leave us some comments if you have any questions or doubts related to forex lot sizes and in calculating the lot value. Also, let us know in which lot size you trade most. If you like our articles then please like our facebook and twitter page for receiving latest updates. Why Do Many Forex Traders Lose Money? Here is the Number 1 Mistake. by David Rodriguez , Quantitative Strategist. Big data analysis, algorithmic trading, and retail trader sentiment. Your Forecast Is Headed to Your Inbox. But don't just read our analysis - put it to the rest. Your forecast comes with a free demo account from our provider, IG, so you can try out trading with zero risk.

Your demo is preloaded with ?10,000 virtual funds , which you can use to trade over 10,000 live global markets. We'll email you login details shortly. You are subscribed to David Rodriguez. You can manage you subscriptions by following the link in the footer of each email you will receive. An error occurred submitting your form. Please try again later. We look through 43 million real trades to measure trader performance Majority of trades are successful and yet traders are losing Here is what we believe to be the number one mistake FX traders make. W hy do major currency moves bring increased trader losses? To find out, the DailyFX research team has looked through over 40 million real trades placed via a major FX broker's trading platforms.

In this article , we look at the biggest mistake that forex traders make, and a way to trade appropriately . Why Does the Average Forex Trader Lose Money? The average forex trader loses money, which is in itself a very discouraging fact. But why? Put simply, human psychology makes trading difficult. We looked at over 43 million real trades placed on a major FX broker's trading servers from Q2, 2014 – Q1, 2015 and came to some very interesting conclusions. The first is encouraging: traders make money most of the time as over 50% of trades are closed out at a gain. Percent of All Trades Closed Out at a Gain and Loss per Currency Pair. Data source: Derived from data from a major FX broker* across 15 most traded currency pairs from 312014 to 3312015. The above chart shows results of over 43 million trades conducted by these traders worldwide from Q2, 2014 through Q1, 2015 across the 15 most popular currency pairs.

The blue bar shows the percentage of trades that ended with a profit for the trader. Red shows the percentage of trades that ended in loss. For example, the Euro saw an impressive 61% of all trades closed out at a gain. And indeed every single one of these instruments saw the majority of traders turned a profit more than 50 percent of the time. If traders were right more than half of the time, why did most lose money? Average ProfitLoss per Winning and Losing Trades per Currency Pair. Data source: Derived from data from a major FX broker* across 15 most traded currency pairs from 312014 to 3312015. The above chart says it all. In blue, it shows the average number of pips traders earned on profitable trades. In red, it shows the average number of pips lost in losing trades.

We can now clearly see why traders lose money despite being right more than half the time. They lose more money on their losing trades than they make on their winning trades . Let’s use EURUSD as an example. We see that EURUSD trades were closed out at a profit 61% of the time, but the average losing trade was worth 83 pips while the average winner was only 48 pips. Traders were correct more than half the time, but they lost over 70% more on their losing trades as they won on winning trades. The track record for the volatile GBPUSD pair was even worse. Traders captured profits on 59% of all GBPUSD trades. Yet they overall lost money as they turned an average 43 pip profit on each winner and lost 83 pips on losing trades. What gives?

Identifying that there is a problem is important in itself, but we’ll need to understand the reasons behind it in order to look for a solution. Cut Losses, Let Profits Run – Why is this So Difficult to Do? In our study we saw that traders were very good at identifying profitable trading opportunities--closing trades out at a profit over 50 percent of the time. They utlimately lost, however, as the average loss far outweighed the gain. Open nearly any book on trading and the advice is the same: cut your losses early and let your profits run. When your trade goes against you, close it out . Take the small loss and then try again later, if appropriate. It is better to take a small loss early than a big loss later. If a trade is in your favor, let it run . It is often tempting to close out at a small gain in order to protect profits, but oftentimes we see that patience can result in greater gains. But if the solution is so simple, why is the issue so common? The simple answer: human nature. In fact this is not at all limited to trading. To further illustrate the point we draw on significant findings in psychology. A Simple Wager – Understanding Human Behavior Towards Winning and Losing.

What if I offered you a simple wager on a coin flip? You have two choices. Choice A means you have a 50% chance of winning 1000 dollars and 50% chance of winning nothing. Choice B is a flat 450 point gain. Which would you choose? 50% chance to Win 1000. 50% chance to Win 0. Expect to win $500 over time. Over time it makes sense to take Choice A—the expected gain of $500 is greater than the fixed $450. Yet many studies have shown that most people will consistently choose Choice B. Let’s flip the wager and run it again. 50% chance to Lose 1000. 50% chance to Lose 0. Expect to lose $500 over time. In this case we can expect to lose less money via Choice B, but in fact studies have shown that the majority of people will pick choice A every single time. Here we see the issue. Most people avoid risk when it comes to taking profits but then actively seek it if it means avoiding a loss.

Why? Losses Hurt Psychologically far more than Gains Give Pleasure – Prospect Theory. Nobel prize-winning clinical psychologist Daniel Kahneman based on his research on decision making. His work wasn’t on trading per se but clear implications for trade management and is quite relevant to FX trading. His study on Prospect Theory attempted to model and predict choices people would make between scenarios involving known risks and rewards. The findings showed something remarkably simple yet profound: most people took more pain from losses than pleasure from gains . It feels “good enough” to make $450 versus $500 , but accepting a $500 loss hurts too much and many are willing to gamble that the trade turns around. This doesn’t make any sense from a trading perspective—50 0 dollars lost are equivalent to 50 0 dollars gained; one is not worth more than the other. Why should we then act so differently? Prospect Theory: Losses Typically Hurt Far More than Gains Give Pleasure.

Taking a purely rational approach to markets means treating a 50 point gain as morally equivalent to a 50 point loss. Unfortunately our data on real trader behavior suggests that the majority can’t do this. We need to think more systematically to improve our chances at success. Avoid the Common Pitfall. Avoiding the loss-making problem described above is very simple in theory: gain more in each winning trade than you give back in each losing trade. But how might we do it concretely? When trading, always follow one simple rule: always seek a bigger reward than the loss you are risking. This is a valuable piece of advice that can be found in almost every trading book. Typically, this is called a “ rewardrisk ratio ”. If you risk losing the same number of pips as you hope to gain, then your rewardrisk ratio is 1-to-1 (also written 1:1). If you target a profit of 80 pips with a risk of 40 pips, then you have a 2:1 rewardrisk ratio. If you follow this simple rule, you can be right on the direction of only half of your trades and still make money because you will earn more profits on your winning trades than losses on your losing trades. What ratio should you use? It depends on the type of trade you are making. We recommend to always use a minimum 1:1 ratio .

That way, if you are right only half the time, you will at least break even. Certain strategies and trading techniques tend to produce high winning percentages as we saw with real trader data. If this is the case, it is possible to use a lower rewardrisk ratio—such as between 1:1 and 2:1. For lower probability trading, a higher rewardrisk ratio is recommended, such as 2:1, 3:1, or even 4:1. Remember, the higher the rewardrisk ratio you choose, the less often you need to correctly predict market direction in order to make money trading. We will discuss different trading techniques in further detail in subsequent installments of this series. Stick to Your Plan: Use Stops and Limits. Once you have a trading plan that uses a proper rewardrisk ratio, the next challenge is to stick to the plan. Remember, it is natural for humans to want to hold on to losses and take profits early, but it makes for bad trading. We must overcome this natural tendency and remove our emotions from trading. The best way to do this is to set up your trade with Stop-Loss and Limit orders from the beginning . This will allow you to use the proper rewardrisk ratio (1:1 or higher) from the outset, and to stick to it. Once you set them, don’t touch them (One exception: you can move your stop in your favor to lock in profits as the market moves in your favor). Managing your risk in this way is a part of what many traders call “money management” . Many of the most successful forex traders are right about the market’s direction less than half the time.

Since they practice good money management, they cut their losses quickly and let their profits run, so they are still profitable in their overall trading. Does Using 1:1 Reward to Risk Really Work? Our data certainly suggest it does. We use our data on our top 15 currency pairs to determine which trader accounts closed their Average Gain at least as large as their Average Loss—or a minimum Reward:Risk of 1:1. Were traders ultimately profitable if they stuck to this rule? Past performance is not indicative of future results, but the results certainly support it. Our data shows that 53 percent of all accounts which operated on at least a 1:1 Reward to Risk ratio turned a net-profit in our 12-month sample period. Those under 1:1? A mere 17 percent. T raders who adhered to this rule were 3 times more likely to turn a profit over the course of these 12 months—a substantial difference. Data source: Derived from data from a major FX broker* across 15 most traded currency pairs from 312014 to 3312015. Game Plan: What Strategy Can I Use? Trade forex with stops and limits set to a riskreward ratio of 1:1 or higher. Whenever you place a trade, make sure that you use a stop-loss order.

Always make sure that your profit target is at least as far away from your entry price as your stop-loss is. You can certainly set your price target higher, and probably should aim for at least 1:1 regardless of strategy, potentially 2:1 or more in certain circumstances. Then you can choose the market direction correctly only half the time and still make money in your account. The actual distance you place your stops and limits will depend on the conditions in the market at the time, such as volatility, currency pair, and where you see support and resistance. You can apply the same rewardrisk ratio to any trade. If you have a stop level 40 pips away from entry, you should have a profit target 40 pips or more away. If you have a stop level 500 pips away, your profit target should be at least 500 pips away. We will use this as a basis for further study on real trader behavior as we look to uncover the traits of successful traders. *Data is drawn from FXCM Inc. accounts excluding Eligible Contract Participants, Clearing Accounts, Hong Kong, and Japan subsidiaries from 312014 to 3312015. View the next articles in the Traits of Successful Series: The Traits of Successful Traders. This article is a part of our Traits of Successful Traders series. Over the past several months, The DailyFX Research team has been closely studying the trading trends of traders via a major FX broker. We have gone through an enormous number of statistics and anonymized trading records in order to answer one question: “What separates successful traders from unsuccessful traders?”. We have been using this unique resource to distill some of the “best practices” that successful traders follow, such as the best time of day, appropriate use of leverage, the best currency pairs, and more. Stay tuned for the next article in the Traits of Successful Traders Series. Analysis prepared and written by David Rodriguez, Quantitative Strategist for DailyFX.

com. Sign up to David’s e-mail distribution list to receive future e-mail updates on the Traits of Successful Traders series and other reports. Contact and follow David via Twitter: twitter. comDRodriguezFX. DailyFX provides forex news and technical analysis on the trends that influence the global currency markets. -. . ( ). . . . ( .) . . ( — ). . (, , , , ). ( , .) . ( ). , . . . ( – ) * ( ) * . : USD : GBPCHF = GBP; = CHF = CHFUSD = 1,1025 = 2,1443 = 2,1452 = 1000. = (2,1452 – 2,1443) * (1,1025) * 1000 = 0,99225 USD. . . OANDA. . , , . © 1996–2017 OANDA Corporation. . OANDA, fxTrade fx OANDA Corporation. , , . . , . . , , . , . - . . « » . - OANDA Europe Ltd, . , 4 50:1 . , . OANDA Corporation — , ; , .

№ 0325821. . . OANDA (Canada) Corporation ULC . OANDA (Canada) Corporation ULC (IIROC), . cipf. ca. OANDA Europe Limited , 7110087, : Tower 42, Floor 9a, 25 Old Broad St, London EC2N 1HQ. , № 542574. OANDA Asia Pacific Pte Ltd (. № 200704926K) , , (IE Singapore). OANDA Australia Pty Ltd (ASIC) (. ABN 26 152 088 349, . AFSL 412981). () , . (FSG), ('PDS'), OANDA. . OANDA Japan Co., Ltd. — Kanto Local Financial Bureau (Kin-sho), . № 2137; , . № 1571. How Many Percent of Traders Make a Profit ? The question of how many traders achieve a profit with Forex trading is often discussed between FX traders or in Forex discussion forums.

We have made an analysis and come to the conclusion that only 10-20% of all FX traders achieve to make a profit. Analysis: Profit in Forex Trading. For our analysis we have randomly selected 50 FX traders from eToro whose data we have gathered from the eToro Open Book. The “Open Book” is just what is says, an open trading book. You can see there in real-time which trader has just bought or sold a currency pair and how much profit he achieved (losses are not shown in the eToro open book). In addition, you can see for every trader his trading statistics. So you can see in what percentage of trades he has made a profit and how his personal income statement looks for the last 30 days. The result is sobering: Only 8 of the 50 traders were able to achieve a profit: About a third of the traders achieved a total loss or close to a total loss (90% or more lost). The main statistical values ??from our analysis are: 8 of 50 traders (16%) achieved a profit The average loss was -48.5%, the median was -54.7% On average, 56.5% of the trades were completed with a profit.

The last point is surprising – although five out of six Forex traders made a loss, more than half of the trades were closed with a profit. If we compare the profit per trader and the percentage of trades with a profit, we get the following picture: A clear trend can not be derived. Presumably, the percentage of successful trades is not a reliable criterion to assess whether a trader made a profit overall. Conclusions Analysis Forex Trader Winnings. Our analysis confirms what every trader should already know: Forex trading is very risky, and most traders lose money online. It is therefore extremely important to maintain a good Forex risk management . This means that only a small proportion of the money you have available should be risked in one specific trade. The risk of a total loss can be reduced considerably using this strategy. And that the vast majority of traders lose money is clear. Many small traders compete against the few pros. These professionals can make a profit – at the expense of many small traders.

And don’t forget that FX brokers earn money with each trade by earning the spread. It is therefore not surprising that not 50%, but only about 10 to 20 percent of all FX traders make a profit. Second, even those 10 traders who suffered a 100% loss, on average completed 48% of trades with a profit. This shows that they were trading quite successfully for a while, and then lost all of their money with a few completely failed trades. Thus, while their profit was often only a few percent, their losses were up to 100%: achieving small profits and making huge losses is a very bad trading strategy. It is therefore extremely important to know when to close a position before entering into that position, and then to stick to that decision. This means in practice that you should immediately put a stop loss order on your trades. This will help to reduce the losses to a tolerable level. As a third consequence, the analysis shows that many traders seem to lack the necessary experience. We recommend to every FX trader to first gain experience without risking real money by trading with a free demo account. A FX broker with an unlimited trial account is eToro: How profitable is Forex Trading. Myths and reality.

Forex is full of misconceptions indeed. Many novice forex traders coming into the FX market are exposed to very smart marketing techniques. These techniques tend to produce fairy tales around very logical concepts. They are designed to make Forex industry very attractive by promising the impossible. Among many, the income expectations in the retail FX market are seriously overdone. Marketers give traders an unrealistic picture about the potential income or a promise of becoming financially independent by working 10 min per day. He? They make it look like hedge fund and pension fund returns are very small to compared to the opportunities waiting in FX market. Traders are expecting to make 100%, 200%, 500% in few weeks. All the above should sound at least suspicious to a semi intelligent human being. Here I would like to give you my view on a few misconceptions. I got an email from one of my followers asking very valid questions about important factors of trading including income expectations. Below is the email from John. I hope I can provide valuable and logical advise. I have been trading FOREX for many years on a dummy account in order to achieve consistency. From the end of Feburary 2015 to the end of December 2015 I had been trading positively and increased the account size by 16%. I only ever risk 1% of my capital per trade. After this run I decided to try and increase my return.

I changed absolutely nothing except I spent more time in front of the computer and took more trades. This did not work out I was once again I started losing money. My questions are as follows; Is 16% return in 10 months reasonable? What would you consider as an average return for a retail FOREX trader? How many trades per month does an average trader place? It seems to me that the best trades are low risk trades and these are few in the month. As I try to increase the number of trades I am taking higher risk trades which turn into losers. What’s your view? Presently I look for a 1.5 return on my trades. What would you consider to be an average RiskReward ratio? Or a range. For a successful trader what is the average win to lose ratio? I find it decreases as I try and place more trades. Is this normal? I am going to jump right into your questions and provide feedback at the end. Is 16% return in 10 months reasonable?

This is just over 19% per annum. In my opinion, this is an excellent return given that you kept your risk at 1% at the time. Kudos to you. To give you some perspective see the list of top performing hedge funds in 2015 with funds between $250 mil and $1B in assets. You note that the returns average around 26% per annum. Hedge funds are known for aggressive portfolios and high results. Other funds and investments vehicles available to an ordinary break eater would produce much lower results, especially in the era of global depression and zero bound interest rates. There is no easy way to make money since housing bubble has burst. See the sample of popular Mutual Funds below. Full data can be accessed here. You see how these funds achieve only single digits returns and some of them were negative last year.

You could do some more research and find out that the standard pension fund is working off 8% annual return benchmark (at least the last time I checked). Anything beyond that is bonus or come with increased risk. Obviously portfolios can be allocatedfocused on certain industries. The performance will depend on the “alpha” of the fund manager and economic conditions at the time. Portfolio theory clearly states, the higher the return the higher the risk. There are no two ways about it. I want to make two points: Your 20% per annum of return would put you way above the standard pension or mutual fund portfolio and pretty close to top performing hedge funds with over $250mil in assets. Not too bad I think! Surely people who run those funds are probably the most intelligent human beings on this planet. They came from families who could afford to send them to best schools. They are ambitious, hardworking executives with an excellent understanding of economics and finance.

They often have influential friends in many sectors they invest in. I don’t see any Hedge Fund achieving 100%, 200%, 500% returns on the list above. How is that? If they can’t do it, why would anybody think they can come in, open MT4 with no knowledge of finance and economics or previous experience and produce 500% returns by drawing lines on EURUSD 5 min chart. How many of us think, we can outsmart these guys with Stochastic crossover strategy? What would you consider as an average return for a retail FOREX trader? I don’t know what is the average return of an average retail FX trader but I can tell you that on average 90% of people who open a trading account blow it for an average of $600 in less than six months. This is why brokers can afford paying $10-$30 per click in google adwords or put a banner on the home page of busy Forex websites at cost of $50K month. This industry is comparable to the insurance or mortgage brokerage industry in 2008 where life time value of the customer is high. From this alone, it’s hard to calculate an average return. Those accounts might have produced 3 digits returns for few weeks but this is only possible by taking enormous risk which results in margin calls sooner or later. Most of those people will never see the money they deposited with the broker again! The TRUE average return would have to be calculated over long period of time on accounts of traders who survived and are still in money today.

I guess the average would be less than 10% per annum. Please feel free to challenge me on this as I have no hard evidence. How many trades per month does an average trader place? It seems to me that the best trades are low risk trades and these are few in the month. As I try to increase the number of trades I am taking higher risk trades which turn into losers. What’s your view? There should be no benchmark for how often you trade. I can see your gut tells you: “lower the risk and trade safely” This is good. Listen to it. The market will tell you how often you should trade. Take only high probability, low risk positions. Volume does not matter . I base my trades mostly on Commitments of Traders analysis. This allows me to spot high probability market reversals and position my trades accordingly.

I could have only few trades per year, but once I’m in the market, I stay in for months. This kind of strategy also allows me to cash in the carry trade interest on leverage positions. I want to make two points: Many “traders” are interested in trading itself rather than preserving and grow capital over time. Don’t be one of them. Take only low risk positions in accordance with your tested trading technique. Keep your risk as low as you can and you will succeed. If you believe your strategy is valid and makes money, add more funds to your account and increase the lot size rather than increase the risk as a % of equity per trade. Do not trade more often because you believe your strategy is sound. The FX market will always be there, there should be no rush. The price will always print no matter what, even 100 years from now. Patience is one of the great qualities of a successful investor. "The most money in this world was made by waiting not working." I forget who said that, either Jessie Livermore or Warren Buffet? Every time you press the button BUYSELL you expose your account to a possibility of a loss.

The least often you trade as better it is for your account. You will save a fortune over time on broker’s fees. You need to be taking only low risk positions every time you press the button. A Professional trader generates 80% of income from 20% of winning positions. Every time you see that in stats, it means the trader stays in winning positions as long as possible, instead jumping in and out. Once you recognise a trend – get in, sit back and ride it. It takes a great deal of patience to do so as the market is there to shake the weak players out. Most traders don’t wait, they get it and out and lose money. Don’t be one of them. Presently I look for a 1.5 return on my trades. What would you consider to be an average RiskReward ratio? Or a range. 1.5:1 is rather the lower band of a good risk reward ratio. Having said that, it will allow you to stay ahead, even if you have less than 50% losers. You should always assume less that 50% accuracy in the long run. Thinking you can get more is statistically incorrect. If you can, look for 2:1 ratio by testing the strategy to see if you are hitting the same amount of winners. Increasing ratio means increasing take profit levels.

This will result in more breakeven trades as you will hit profit target less often. You might end up worse off in terms of a total profit. Instead of moving the profit target, try limit orders. I find it much more effective. Let the price fill your order at the better price and keep your profit targets unchanged. This way you will improve your ratio over time. It will depend on your time horizon as well. A good trading strategy will produce most profits out of the least winning positions. This means, you stay in winning trades longer but cut losing position quickly. Such a strategy might be only 30% accurate but still generates healthy profits.

For a successful trader what is the average win to lose ratio? I find it decreases as I try and place more trades. Is this normal? As mentioned above, you need to assume to hit less than 50% in the long run. You should also account for broker’s fees and swaps. This will decrease your odds again. Good, sustainable strategy is less than 50% accurate. It will show fewer trades with huge winnings and many small losers. Such a dynamic shows that the trader cuts losers quickly and let winners run. My feedback. I want to make two points: (as usual) As I understood, your return was made in demo account? Is that correct? If so, I don’t want to burst you bubble but it is very unlikely (in my humble opinion and based on my humble experience) to replicate it in the real money account.

Once you put your own money on the table, your heart starts to beat differently and your mind plays tricks on you. You need to account for this. Over the years I've learnt to test all new trading strategies on a real money right away. Many will tell you, this is BS, but it worked for me. I don’t mind paying for testing once I get real, unbiased results. Psychology in this game is tricky, you need to expose it as early as possible. Another thing to remember, the real account will have totally different spreads. The broker does not hunt your stop in demo account or increase the spread during volatility. It might seem little but It makes a difference. The broker will hunt your stops in real account and widen spread during news releases. My advice – If you are thinking long term, move to a real account right away to get better understanding of real trading conditions. If you are already trading real cash - Kudos to you again! You made 20% in one year. Now you will need to do it over and over again for the rest of your professional career. Do you think you can do it? Do you think your strategy is resistant to ever changing market conditions? What is bullish for dollar today, might be totally bearish in 5 years from now. You will need to update your strategy with new variables to adjust to ever changing markets. The LTCM story has proven this is some challenge indeed!

If you want to average 20% for the next 20 years. It’s likely, you will have years with 50% profits and years with no profits at all. It will be hard to get through the latter ones. I guess over the long run; you will place thousands of trades. Statistically, it is likely you will have more than 10 losers in the row. You need to be ready for this. Once you get all above right, think about rewarding yourself in the form of compounding. The equation below shows how your equity could grow over 20 years with 20% annual return. This is assuming $1000 initial investment. That’s a good retirement, even after taxes so stay going as you are. As you probably now imagine, triple digit returns promised by internet marketers would translate into 100s of milions of dollars over time. This is just not adding up. My advise is: Don’t over trade Be patient Preserve your capital Be consistent Adjust with new information. Stay humble. Trading in Forex Exchange Market is VERY SPECULATIVE AND HIGHLY RISKY and is not suitable for all members of the general public but only for those investors who: (a) understand and are willing to assume the economic, legal and other risks involved. (b) Taking into account their personal financial circumstances, financial resources, life style and obligations are financially able to assume the loss of their entire investment. (c) Have the knowledge to understand Forex Exchange Market and the underlying assets. What are Realistic Profit Targets for a Successful Trader? Keep in mind that using cutoffs, as explained in this article, does not work for every trader.

Some systems require you to take every setup that comes along, whether you’re up or down, in order to take advantage of the edge that the system provides. Each trader has their own level of risk tolerance and desired daily, weekly and monthly profit targets. Many successful traders use daily, weekly, monthly and even yearly cutoffs. New traders shouldn’t concern themselves with profit goals but instead, focus on consistency. That being said, what are some realistic profit goals for a successful Forex trader? Setting Realistic Profit Targets in Trading. It all starts with setting realistic daily goals. Swing traders might start with weekly goals for obvious reasons. It is important to set your goals in actual profits, as opposed to pips. It is also important to use the same amount of risk (exposure) on every trade.

Varying exposure is a good way to wipe out your account – even if you’re using a solid trading system. Daily goals are largely determined by your level of risk tolerance. For instance, I risk 1% per trade. My daily profit cutoff is 2%, so I only need one or two successful trades with no losses to hit that mark. If you are only risking .5% per trade, a more realistic daily profit cutoff might be 1% per day. Shooting for 2%, while risking .5%, would take two to four successful trades with no losses to achieve. In other words, it’s not likely to happen. Note: Don’t just jump into the market. Learn a good trading system, and then backtest and demo trade until you prove to yourself that you can be consistent in the long run (months or years – not days or weeks). When you start trading a live account, use the smallest lot size (or number of shares, contracts, etc…) available to you at first. Gradually increase your exposure per trade to your desired risk level as you become accustomed to the psychological hurdles of trading real money. I am comfortable risking 1% per trade.

Most successful traders would recommend using .5 – 1% per trade. Very advanced traders often risk 3% or more per trade. How much money are you willing to lose per trade? Once you have determined your personal level of risk tolerance, you can determine a daily goal or cutoff. Weekly and Monthly Goals. From there, your weekly and monthly cutoffs can be set. I have a more aggressive risk tolerance, so my profit cutoff targets are as follows: 2% daily, 5% weekly and 15% monthly. I don’t use yearly cutoffs. These targets may seem high to some traders, but they are realistic for me. Note: This does not mean that I make 2% every day, 5% every week, etc…. If I make 2% in a day, that’s a good day of trading. Likewise, 5% is a good week of trading. If you are not consistent yet, you should focus on learning a profitable trading system and becoming a long-term, consistently profitable trader.

If you’re just starting out, shooting for 5% per month makes much more sense. If you think that you can double your account every few months in trading, you are not likely to set realistic profit targets. You will likely overtrade your way to a smaller account balance. You will risk too much, and you will lose too much. Greed causes traders to be overconfident and overactive in the market, which leads to mistakes. Small consistent and compounded profits will lead to a fortune in the long run. Remember: Money management cutoffs work both ways. If I am down 2% in one day (or two losses in a row), I stop trading that day. I stop trading if I lose 3% in one week. Lastly, I use 5% as my monthly losses cutoff. Keep in mind that I have a more aggressive risk tolerance. The Importance of Setting Realistic Profit Targets. In my opinion, money management skills are the most important aspect of achieving long-term profitability. I never made any consistent profits in the Forex market until I learned how to manage my risk.

Setting realistic profit targets is an important part of good money management, and setting the maximum amount you are willing to lose per day, week, and month is equally as important. Another aspect of good money management is risking a small percentage (.5 – 1% or less) of your total account balance per trade. Depending on your trading style, you should also only take trades with the potential of making twice what you are risking or more. That ratio is known as the risk – reward ratio. Example: Let’s say your account balance is $2,000. You place a trade risking 1% of your account or $20. The trade goes your way and hits your profit target, resulting in a closed trade and a $40 win. Since you risked $20 and profited $40, this trade would have achieved a 1:2 risk to reward ratio. If your average winning trade achieves at least a 1:2 riskreward ratio, you can be profitable with a 50% win rate. With a 1:1 ratio, you would break even if you won half of all the trades you took. It’s easy to see that the riskreward ratio is an important part of good money management. In trading, you are almost guaranteed to experience runs of consecutive losses from time to time.

Risking a small amount per trade, and setting a maximum acceptable loss percentage can ultimately limit the harmful effects of drawdown periods – helping you preserve your capital. To new traders, these concepts may seem foreign, but they are absolutely essential to long-term profitability. By using proper money management, including realistic daily, weekly and monthly profit targets and cutoffs, you are ultimately reducing your risk. Are you still looking for a profitable trading system ? I recently changed my main trading system after testing a new one for over a year. Come see why I switched to Day Trading Forex Live. What Is Money Management and Why Is It So Important In Trading? What’s the Best Reward to Risk Ratio for Forex Trading? Need a Free Forex Trading Journal Spreadsheet? may i know more details? Sure.

What would you like to know more about? Hi Chris : how many hours would you have to actively trade each day to make the average 2%. ? Mi initial goal is to make $150-200 per day. I am looking to start with 20k , is this realistic expectation for somebody totally new to trading. I plan to do a lot of homework before I do this. D. Hey Dan. Thanks for commenting. The time it takes to trade really depends on the system you’re using. Some systems require very little time to operate, while others require you to sit in front of your screen the whole time. If time is a concern (like it is for most), then you should stick to swing trading strategies. Those will be the least time consuming, and the most meaningful trades (since you use a daily chart). To meet your goal of $150-200 per day, you’d have to earn 15-20% of your $20k each month. 15-20% is a lot to consistently make for a beginner, but it’s not impossible.

However, think about this: in one year, earning only 10% per month, you would more than triple your account. At that point, 10% is over $6K – exceeding your initial goal. Obviously, you should demo trade for, at least, a couple of months, or until you are making consistent profits. After doing that, you should have a pretty good idea of exactly how much you can make per month. Then the only challenge becomes doing the same thing with your real money account that you did with your demo account. Good luck! Chris! I make 2.5% average everyday, sometimes way more like 8 percent in a day. I am also 21 and have all the time in the world. You think I could become big? Hey, Daniel! Thanks for commenting.

Even if you only made 2.5% each week, you’d be wealthy after just a few years. Most traders think they need to do better, so they risk more and eventually lose all their gains – not being happy with their “meager 10% per month”. The reality is that someone that can consistently make 10% from the market each month is a superstar in the trading world. Now that I’ve said that, I’ll tell you this, if you’re really making those kind of returns, and you’re doing it consistently with a real money account, then you’re already a superstar. You’re already big. Good luck! When you talk about 10-15% per month returns you mean returns on your principle e. g. $20,000 or your leveraged (100:) $2 million. Because 10% on leveraged $2 million would be 200,000 USD per month and that seems too much. The money you have at your disposal for leverage doesn’t matter. Neither do pips. We always speak in terms of profit or loss to our actual trading capital. If you can’t withdraw it, then it’s not really yours. I am trading live now for 10 days. I am using 100:1 leverage have $50,000 in my account and I used about $2 million on 1 open trade EURGBP, I bought EUR at 0,6934 and sold it at 0,70382, I made 30,000 EUR in 36 hours.

I only made 1 trade because I knew Greek MPs will vote in favour of new bailout plan. The next trade I will do when 20 August when Greek have to pay 3.6B interest to IMF, which of course they will default on again and then I will short EUR. The way I see it there is 1-2 interesting transactions one can do every month. So my non-leveraged return for July is 60% but my leveraged is 1,5%. So when you speak about 10-15% monthly returns, what do you mean leveraged or non-leveraged? Hello again, Daniel. As I mentioned, in response to your previous comment, I’m talking about the money you put into and can withdraw from your account. As for your trading strategy, it sounds like your risking way too much. The trade that you described only gained around 100 pips, but you say that you made 60%. That tells me that you are leveraged up way too high. Most successful traders risk 1-2% per trade (especially in the Forex market). Some very experienced and successful traders risk 3%. What is your exit strategy? What is your plan when one of your trades inevitably goes bad? With that kind of leverage, you’re likely to get a margin call. I don’t trade the news myself.

I’m a technical trader. I like the charts because they tell me what the market is thinking at that moment. However, I know from my limited experience that the expected news is often priced into the market. Have you ever heard the saying, “Buy the rumor, sell the news”? It’s obviously beneficial to understand what’s going on in global financial news, though; because this can keep you out of bad trades, as good and bad news can greatly effect the price of any given market. Most technical traders just make sure they’re out of the market before the news is released. For instance, I’m never in a trade during the non-farm payroll reports. I like that you’re not intent on taking many trades each month, as that has little to do with trading success (quality over quantity). Also, don’t let me stop you from making money. If what you’re doing can work for you long-term, then more power to you. Good luck! Chris! I am able after a long time((2-3 years) of watching the market every second to make even 100% a month sometimes. Not always. I tried all my personal systems on real money and ive lost some of them but not in vain. As you already know real money trading is different than virtual trading.

The only thing that i lack is cash. Now, if you think that what is said is too much, consider the fact that i maintained break even for 2 years while trying the systems only on 1000 euros. Unfortunately i dont have university diploma, i studied economics, finance trading all by myself so i cannot go to work for a firm. Do you think that there are firms that hire without diplomas? Thank you. Popa, it’s true the two are different psychologically, and many demo accounts do not include fees. They also, sometimes (or many times), fib on their spread prices on the demo servers. However, if you’re making good, CONSISTENT profits on your demo account for long periods of time (months – not days or weeks), then you should be able to start risking a very small portion of your real money, slowly working your way up to a responsible risk per trade, and have similar success in your live accounts. I’m not sure about how a trading firm hires, but I can tell you that no amount of formal education can prepare you for a career in trading. The same is true for many other entrepreneurial endeavors. It takes a pioneering spirit, tenacity, and a LOT of patience.

Also, most traders are unsuccessful. I know of one woman that started consistenly making around 4-5% per month in her live account, and soon found herself managing a lot a money for a lot of people. That’s because most traders would kill to consistently make even a few percent points per month. You don’t need to make a lot each month to make a fortune in the long run. You just need to be consistent and let your account grow. Hope that helps you. Good luck! I have been training Demo for 5 years, worked eventually out a system that would not make me stress all day. I tested this system on a unrealistic account of 50K with 2-4 tradesday of 45K only (to limit the margin). During a period of 2 months, i reached a 65% win ratio (2:1). Considering that I apply a 1:1 profitloss rate, does it mean that I cannot lose money only if I keep spotting all these winning trades and not all the losing ones. ? I went live with only 1.5kE, lost 20% within 2 weeks due to stress, lack of discipline and bad choices. I started getting used to the pressure and refined my system and I am up exactly 20% now after exactly 50 days of live trading. I do use an excess of margin (15% at times) but I systematically use SL and TP (1:1) with an exact profitloss of about 2% of my equity. If I do reach a 40% profit, I plan to increase my lots by 1K (4-5 to 5-6) and increase slowly my profit as long as I stay at 60-65 % winloss trade ratio. Do you think I am risking too much ?

I’m a little confused about the way you worded some of this, but from what I understand (correct me if I’m wrong), you’re risking 2% of your trading account per trade, and you’re up 20%. If that’s the case, there’s not much to complain about, as long as you can stay consistently profitable with this strategy. I have a few suggestions that might help you, though. The reason I recommend risking a small percentage of your account on each trade is because every system goes through periods of drawdown (consecutive losses). If you risk too much, these periods can make your trading life very difficult. If you, for instance, lose 50% of your account, you have to make a 100% return of your remaining capital just to be back at break even. What I’m getting at is that 2%, for a new trader, is a little high, but it’s much better than most traders start out using. If it’s working for you (including through your drawdown periods) then keep it up. I wouldn’t recommend risking any more, though. You will start to slowly increase your profits as your account grows anyway. I still only risk 1-2% per trade, depending on the strategy. 60-65% is a very good strike-rate, especially for a new trader. 1:1 riskreward is not ideal (in my personal opinion), but I realize some strategies rely on quick profits. It also takes a more powerful strategy and more discipline to successfully execute a 2:1 strategy.

I wouldn’t change your whole strategy if it’s working, but you might try employing a trailing stop strategy once your winning trades hit your initial target. This could give you an occasional boost in returns, but you should practice any new strategies before live trading with them. I like that you demo traded for so long. Most traders would never do this, so you’re already showing great patience, which is key to being successful over time. Keep taking the best setups, and keep using wise money management. Good luck! I think I have not made myself clear enough. I do bet 2% per trade (meaning up to 6% when I had 3 trades simultaneously), and that could account up to 15% of my equity, but I would never reach a margin call. I know it is risky, but I do use a strategy with fixed profits. I bet a certain amount to win the same or to lose the same amount (1:1). If profitable, I won’t change anything, except my use of the equity. I will increase my lot size by 20% once I reached 40%profit.

I don’t agree with the ‘belief’ that if you lose 50% then you need to gain back 100%. On paper, it is true, but when I lost 20% at first of my equity, I had lost on balance WinLoss 9 trades. To get back at the start I won on balance WinLoss 9 trades because I bet on fixed loss or profit. Probably risky, but Forex is risky like Black Monday (in 1 minutes, everything changed). Now I have more Win than Losses, explaining my profit. I peaked at 70% wl ratio to drop back after. The only times I lost many in a row is when I lost control and did not apply the rules I should have stuck with. Even after 5 years, discipline and patience are difficult to maintain, but eventually I will get 100% solid on these virtues. I found the trailing stop was very detrimental to my profit, though I may have tested it at the wrong time only for a too short period. I also found it was more stressful to follow it up. I take what I can take (in general 45 pip average) and I don’t look back on the big 200-300 pip that may or not happen. If I stick to a 60+-5% wining rate, I cannot lose, can I? Slow but profitable ! Sounds like you’ve got it figured out. Do what works for you. Good luck! Hello Chris I am new and don’t really understand a lot of things. Just few of them but I want to start trading. So I need advices. What should I do? Hello Gracien.

Welcome to the site and to trading. I’ll tell you what I would have done differently, knowing what I do now. Hopefully this will help you and others. First, you need to find a good trading system, or none of the rest of this will matter, even if you’ve just decided to only take one or two price action signals or something. Find something that makes sense to you. I can recommend one or two systems. Second, you need to prove that your chosen system is profitable in the long term. You do this by taking at least 100 demo trades. Depending on the system, you can do these trades through backtesting. I recommend doing this whenever possible because it will give you months or even years of experience with your system in only a few hours. Some systems may only give accurate results through forward testing (live market demo trading). For instance, a system that relies on news releases will have to be forward tested.

Note: For backtesting in MT4, simply hit F12 to move forward one candlestick at a time. Shift + F12 moves backward one candlestick at a time. Alternately, you can use Forex Tester for a more realistic backtest. There is a free version with limited functionality. I recommend using this if you can. Gaining confidence in your system is key. If you don’t have this, you will jump ship after your first streak of losing trades. Third, only after you’ve proven that you have a good system that you can make work for you, you need to start trading a live account. You need to trade with an account small enough that you will not be devastated to lose the whole thing, but big enough to cause emotional pain after a loss or losses. You do this because an account that is too big will cause you to be afraid to pull the trigger on a trade (especially after a few losses), but an account that is too small doesn’t teach you anything about the psychological hurdles that traders must face. Many successful traders recommend doing this early on, and I would too if it were not for the fact that none of this matters when you don’t yet know for sure that you’re trading a profitable system. So figure that out first, then get started on this phase as soon as possible. Lastly, once you’re profitable with your small live account, you can start to trade with more and more money, until you are trading your full capital. This part can take some time because you don’t want to rush things so much that you start to fall into psychological traps. Take your time. You will be much more profitable in the future if you do. Also, most successful traders would recommend not risking more than 1-2% on any given trade (especially in the Forex market). If you do these things, you will be miles ahead of the majority of traders.

I hope this helps you. Good luck! I don’ get what you mean by this: “Weekly and Monthly Goals. From there, your weekly and monthly cutoffs can be set. I have a more aggressive risk tolerance, so my profit cutoff targets are as follows: 2% daily, 5% weekly and 15% monthly. I don’t use yearly cutoffs.” If your daily goal is 2% profit shouldn’t you weekly profit be around 10% and your monthly around 48%. Or those figure are just to take the pressure off and have more reasonable figures? Best Regards, Pedro. Good question. These limits are intended to keep realistic expectations. You’re assuming that it’s possible to hit your target every day, and it may be to some. However, I have NEVER been able to hit my daily cutoff every day of the week. I’m perfectly happy to get 2.5% in a whole WEEK, if it’s consistent. I wouldn’t have settle for that when I first started, but I also gave back everything that I earned and more many weeks, because I was trying to force more gains than my system was giving me. If you’re shooting for 10% per month (like me), you need to make an average of 2.5% per week. I don’t really use daily or weekly cutoffs anymore. I just keep trading until I’ve made 10% or more.

At that point, I’m done for the month. Then only exception to that is that if I’m already close to 10%, but there isn’t enough time for, at least, a few more trades. In that case, many times, I just choose to say, “good enough.” I do that because the next trade could always be a loss, but over a few trades, I’m likely to make more gains – even if a loss comes first. This article is still here to give new traders a better understanding of realistic expectations from the market, and to remind them to use wise money management. You have to take what you can get. For some traders that’s much more than 10%, but for the majority of traders 5-10% per month (while risking 1-2% per trade) is a good goal to work toward. If you want more, don’t get greedy – get good. Hope that helps. I get what you mean, but if you follow high probability trades like naked charts aka Price Action shouldn’t we expect more than just 2.5% weekly. I am not expecting to


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