Binary options money management strategy

When trading, for example, in any activity at risk, you must have a clear and consistent finance management plan. If there is no, you will try to build a house without having to place the foundation first. Many traders miss important opportunities in trading because there are things to consider rather than counting your money. Then it is equal to the exercise plan that is attached to it. Discipline is the golden rule here.

Creating a linked plan begins with asking the 3 questions to the following to yourself:

• How much do I need to risk overall?
• How much do I need to risk a day?
• How much can I risk trading?

Risk management system

The first quiz is fairly easy. For example, I have 5,000 pounds and I want to bring my trading skills to the test, so as a sum that I can take the risk from 5,000 pounds that you start. You may limit the maximum loss of You are at 2,500 pounds that are reasonable. If your trading results in a loss and you find yourself losing 50% of the capital is possible to stop. Try back and think about what happened. It seems obvious now that there is something wrong with your trading plan and requires a new consideration.

The second question is quite complicated and uses more ideas. How often do you think? From the above example, you are willing to risk 2,500 pounds before how fast it stops? My feelings are that you should not be at risk of burning capital in less than 2 to 4 weeks, which means 10 to 20 working days, so you should think of 1 / 10th to 1 / 20th of your funding per day. Which means you will have a risk between 250 to 125 pounds per day.

Are you a trader ‘Active’?

This is considered that you are actively trading or traded at least once a day. If you intend to trade occasionally only? Perhaps the back of the idea you have or the latest news line Suppose you may exchange every 2 or 3 days. In this case, it may be a great attraction that you can find cash that you don’t risk the day you do not trade. So “I didn’t trade for 2 days. I can Risk 750 pounds or 375 pounds today with a single trading “This thing, in fact, just increases the risk you pick up and you can find yourself dropped 2250 pounds with a bad trading just three times. Yes, it may take two weeks to accumulate this loss. But you have only 3 wrong trades and can happen very easily. Therefore, in this case, it is the best to stay with 1 / 10th or 1 / 20th per trading. Day or something similar to 1 / 20th if it happens in trading once.

This makes us answer the final question. How much is the risk? Depending on the number of times you want to exchange each day and if you are willing to spend most of your time on your screen It is possible that you have enough time to trade 1 time per day. In this case, I suggest you trade once. (And daily risk), both of them, at least 1 in 20 of the capital, your risk above £ 125.

Suppose you have decided to risk 200 pounds per day in binary options trading and you plan to trade every day. You can bring everything to exchange to see if you are successful or not. This will be the most vulnerable path. It depends on how long you can devote time to trading. But I will divide any daily number you have decided between 2 to 4 trades. You don’t need to make them all. But it is better to give yourself a few times a day If you have time to separate daily risks in a variety of trades.

Brokers with low minimum trading sizes

Financial management with binary

What I like most about binary options trades is a risk under control. You know how much your highest risk towards trading when you place and is just the cost of options. However, human emotions can happen, especially on bad days. As we have seen above, if you lose the risks per day, you should generally close the screen and wait for tomorrow.

This may be the most difficult to track. As a trader, you will feel that you can make it right. Try again is what you need. But we should look at it this way. Suppose you have the highest risk limit at £ 210 per day, which you are divided into 3 trades at 70 pounds on each trading. If you happen to get all three wrong, you will not likely get four right one, just because of fatigue or trade on the basis of emotions.

At this point, you may be upset or not in emotional balance which may lead to bad judgments and tend to make you choose another loss of trade. From the point of view of your money down 210 pounds and the trade will again make you get the best return 90% or 63 pounds, which will not make you profit for today. But the loss of trade will bring 70 pounds for a total loss of 280 pounds a day.

This can feel worse and even more dangerous, can start a high-risk thread, where you do not limit the number of days or all losses. The limit is a great way to promote trading discipline.

You can add additional rules or restrictions from the above example. (Limit daily limit, £ 210 is divided into 3 trades). You can add rules; 2 straight losses and I leave the day For example, suppose you start the day with 3 straight victories. There is no reason to stop in the winning line. But now suppose you lose the next two people.

Now you still have a profit for that day and can walk away. This rule consists of loss and loss. 2 times will protect your interests for the day and limit the loss. But what you get But also limited the risk per day If you are trading, you may make two more winning trades. But you may make a trade that is double, which in this case will increase to £ 210 for the day you find yourself fell 70 pounds for that day. The rules “2 straight losses = out” can help protect. Remember that in trading one of the most important concepts is the conservation of funds and the ability to trade again tomorrow.

Rules like this may be suitable for some investors. And not others – but the three basic questions remain. One thing that every broker can agree on is that money management is important when talking about the success of trading.

Rule

Another popular strategy for money management is only one percentage of all investments. One of the advantages of this system is that the trade size will increase after the winning trading set. And has adjusted the proportion in the event of a loss.

The percentage rule shows a system that is very simple. When only one trading is only a partial risk This will be less than 5%. Sustainable and low risk strategies may cause only 1% of all funds.

The rules are not very strict, equal to the percentage that does not need to be calculated before every trading – just “basic” every time, so someone with a 1,000 pounds of trading funds may decide to open trading at the price of 20 pounds per trading. Accounted for 2% of funds with each trading risk of 20 pounds, may still be effective until the fund is worth up to 1200 pounds (or may be experiencing a certain amount of defeat and sales Up to 900 pounds) At this point, the trade size can be adjusted.

Therefore, the calculation is not continuous. But there is an additional base for the next trading. Some traders may trade basic once a month. 

Calculate table

To help the use of the system size, the trading rules below are the express schedule to display the trade size ‘immediately’ with the amount of investment and different percentages. Those who want to reduce the risk of trade will want to use less percentage and higher risk recipients will use more percentages. The fund size can be multiplied as appropriate as the percentage.

The above calculators demonstrate the importance of checking the minimum trading size at any potential brokers. If the investment fund is low. Traders can find that they are more difficult to trade than they want because the minimum trading forces them to risk the higher returns, the proportion of bankrolls as a whole.