Forex Swing Trading in 20 Minutes - Position Size and Risk Management

It's important to watch the other videos in the Forex Swing Trading in 20 Minutes video series for some context on this forex risk management and position sizing video: Forex Swing Trading in 20 Minutes - Pairs to Follow and Setting Up Charts: https://www.youtube.com/watch?v=lwZEACzahec Forex Swing Trade in 20 Minutes - Time Frames and Trend Trading Strategy https://www.youtube.com/watch?v=WWvwvigX8eM Forex Swing Trading in 20 Minutes - Crotch Strategy and Strong Support and Resistance: https://youtu.be/LbdfQDN4-WI The most basic risk management strategy is to control the amount you lose on each trade. I cap my risk to about 1% of my capital per trade. That means if you have a $2000 forex account, you can lose up to $20 per trade. If you have a $10,000 account, you can lose up to $100. If you have a $500 account, you can only lose up to $5 per trade. Risking 1% may seem like a small amount, especially if you have a small account, but you can grow your capital rapidly by keeping your risk to 1%/trade. This is because even a losing streak of several trades in a row won't hurt you. Also, your wins are always bigger than your losses, so even if you only win 40% or 50% of your trades you are going to be pulling cash out of the market. Over time as your account grows your percentage gains will translate into bigger dollar amounts each month. Keep risk to 1% per trade to enjoy that payoff. Risk on each trade is determined by the pip difference between your entry and stop loss price, multiplied by the pip value and the number of lots you take on each trade. The video shows how you can fine tune your position size (without math) in order to find the exact position size. To see the math on calculating the ideal position size, see How to Determine Proper Position Size: https://vantagepointtrading.com/archives/2031 As always, find out more at my website: https://vantagepointtrading.com/ and in my Forex Trading eBook: https://vantagepointtrading.com/forex-day-trading-and-swing-trading-strategy-guide

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