Win at Forex Trading
If you are thinking of trading forex or trading already and only making marginal gains, here are some simple tips to increase your profit potential – these tips are all about making more money and there easy to do, here they are…
Learn the 80 – 20 Rule
The Pareto Principle or 80-20 Rule, states that a small number of causes (20%) is responsible for a large percentage (80%) of the effect.
The principle is based on the conclusions of Vilfredo Pareto, who observed that 80% of income in Italy was received by 20% of the Italian population. You often see this in business where 20% of the client base generates 80% of the income.
Of the things you do be it in business or other areas of life, only 20% of what you do really matter in terms of enriching your life.
In forex trading the way to se this is probably 20% of the trades that you take matter 80% are marginal. Many traders simply trade too much cut back you’re trading dramatically.
You don’t get paid for effort in forex trading you get paid for correct market timing and nothing more. All the people who day trade or always want to be in on the action are wasting their effort on trades that don’t matter.
I know traders who focus on high odds trades trade a few times a month and clear 100 – 200% profits annually. They only trade high odds trades and when they do they do this
Hit High Odds Trades Hard
They hit the high odds trades hard risking 10 – 20% of equity on them. You will have probably heard the well worn wisdom risk 1 or 2% but with risk goes reward and you are not going to make much risking a small amount.
If you have been patient waiting for a high odds trade – hit hard the odds favor you! This is not being rash it’s the basis of successful speculation.
Many traders think they need to diversify to spread risk – well risk is really related to your judgment and spreading them around, won’t help you and on a small account, it’s not possible to diversify, as you can’t risk enough to make a meaningful gain.
Forget diversifying don’t dilute a high odds trade with marginal ones just for the sake of it.
Have the courage of your conviction and hit the high odds trades, risk as much as you can and don’t dilute the profit potential.
If you operate a long term trend following system based upon the above tips, you can trade in under 30 minutes a day and hit the best trades and trends and make triple digit profits. So concentrate on them and enjoy currency trading success.