The perfect way to manage your losing trades

Losing trades are inevitable and there is nothing you can do about your losing trades. But the successful traders always trade with low-risk exposure so that they don’t have to lose a huge amount of money in their trades. They always follow the Safeway of trading to protect their investment. Those who want to consider trading as their full-time profession must learn the advanced art of trade management to deal with their losing trades. Even if you lose more than 50% of the time, you can easily make huge money by trading the live asset. You have to look for high-risk-reward trade setups. The new traders are always trading the market with negative risk-reward ratio and losing a significant portion of their investment. Let’s learn the perfect way to manage our losing trades so that we can become a professional trader.

Maintain a trading journal

Journal is very crucial for your trading success. The retail traders don’t keep a record of their trade. They place random trades and at the end of the day lose a significant portion of their investment. Unlike the novice traders, the expert traders are very smart. They always place a trade with managed risk. Even though they have the perfect trade setup, they never take too much risk in any trade. They always consider the risk factors. You need to be more concern about your investment or else it won’t take much time to blow your trading account. If you start maintaining a trading journal it won’t take much time to find your trading mistake. Most importantly you will become a disciplined trader. Discipline is one of the key ingredients to become successful in currency trading. If possible follow a paper-based trading journal since it will give you more precise information about your trading system. During the weekend assess your trading history to learn from your losing trades.

The simple 1% rule of risk management

Having access to the retail trading industry doesn’t mean you will be trading with big lot size. All the senior traders in the exchange traded funds community always limit their risk to 1%.They know very well the outcome of each trade is completely random and no one can give them the perfect entry. So they are always ready to embrace their losing trades. Even if you lose 10 trades in a row there is nothing to worry. You will only lose 10% of your account capital. On the contrary, the novice traders are always taking a big risk and few losing trades blow their trading account. Follow the simple rule of risk management and protect your investment from the wild nature of the market.

Stick to your trading system

In order to deal with the dynamic loss, you must stick to the trading system. If you take too much risk you are not going to become a successful trader. The new traders often change their trading system after losing a few trades. But this is not the professional way of trading the live market. Even a very good trading system might face a series of losing trades. Series of losing trades has nothing to do with your trading system. If you can win a series of trades, it’s very normal to lose a series of trades. So always consider the probability factors in currency trading. Stick to your trading plan and try to find the weakness in your system.

Stop over trading the market

Do you really want to become a successful trader? If so, you need to stop overtrading the market. This is one of the major cause for which the retail traders are losing money. Even a single quality trade execution is enough to secure your whole month profit. You don’t have to trade the market all day long to change your life. Quality will always beat quantity in currency trading profession.