CORRECT AND INCORRECT RISK MANAGEMENT

2022年10月21日

Hello everyone!

Today I want to remind you about the risks!
Risk management is very important in every trade, but most traders are too lazy to act according to the rules, so I decided to remind the basic rules.
They look simple, but following them will greatly reduce losses and increase the win rate.
Let's go!

Correct calculation of possible losses

Beginners are AFRAID to think about losses.
And even more so to count them!
But it must be done, otherwise you will lose much more than you should.
Even BEFORE opening a position, you should know how much you are willing to lose under unfavorable conditions.

Cut losses and let your profits grow

It's strange, but people are ready to quickly fix a profit, but not fix a loss.
Premature profit-taking is a normal phenomenon, as is overexposure of unprofitable transactions.
why?
Because traders are afraid of losing profits and hope that the loss will decrease and even turn into profit.

Don't move your stop loss

If you followed the first advice and calculated the stop loss, and after placing it you started moving, then you did not understand the essence!
Stop loss is very important and it is important not to move it.
In each trade, you risk a certain percentage and should not increase this indicator by moving the stop loss.

Monitor your drawdowns

It's unpleasant to lose, it's unpleasant to analyze your losses, but you have to do it.
Without loss analysis, you will not get better as a trader.
You have to keep track of losses, you have to analyze trades to improve your trading and not repeat mistakes.

Opening positions without risk management

Most traders don't think about risk at all, much less risk management.
Most of them open trades without risk management and therefore most of them lose all their money.

Trading without stop losses

The fear of losses and the fear of being wrong leads to the fact that the trader does not set a stop loss.
If you do not set a stop loss, know that the stop loss is still set, how?
It's simple, in this case your stop loss will be equal to your capital.
The position will close when your account is 0.
Is it easier this way?

Let the losses run

Why don't traders close unprofitable positions?
As mentioned above, it's all about hope.
do you think that the price will sooner or later go in your direction?
Perhaps.
But by that time, most likely you will already be closed by margin call.

Ignoring drawdowns and other important indicators of risk management

Ignoring is a favorite thing of novchikov.
They think that they have understood everything, they think that the market will spare them.
Unfortunately, the market doesn't work that way.
Risk management was invented long before you and will be and will be used after you.
And all because it works and without it YOU CANNOT BECOME a SUCCESSFUL PROFESSIONAL TRADER.

And then it's up to you who you want to be.

Traders, if you liked this idea or if you have your own opinion about it, write in the comments. I will be glad 👩‍💻