Forex Trading – Stack the Odds in Your Favour

If you’re new to Forex trading and notice your equity curve consists of an up and down pattern, there are a few reasons for this. However, the main reason is that you’re not stacking the odds in your favour. While odds are conventionally associated with gambling, the fact is that trading also involves a level of risk and the likelihood of success.

In a casino, the odds are always in favour of the house, which is why the house always wins, although they may lose a few bets here and there. Similarly, traders can and should stack the odds in their favour with trade and risk management strategies and the right mindset.

While gamblers find the fun in the process of waiting to see the outcome, professional gamblers and experienced traders have no such attachment and view trading as a process of probabilities. They tune their minds to the fact that odds are in their favour and that the trivial nature of losses and wins is not important in the long run.

As a beginner in Forex trading, follow this advice starting now to improve your chances of success: regardless of your strategy for entering, exiting, and managing your trades, part of your strategy should include risk management. Risk management is what stacks the odds in your favour. Make sure that every time you trade, the profit you aim to take is thrice the size of your stop loss. By following this simple rule, you only need to win 50% of your trades to achieve profitability.

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