Embrace Your Forex Losses

Posted on 19th January 2018
Embrace Your Forex Losses

Many traders lose money in forex trading and feeling disheartened they quit trading altogether. But quitters can never be winners. You have got to learn to accept the fact that losses are inevitable and you have got to deal with them and control them. It is only by embracing your failures and learning from your mistakes that you can move forward.

  1. Don't Lose Your Composure: Many newbies end up blowing their forex trading account following a string of consecutive losses. As a result, most of them put a full stop to their trading career then and there. But professional traders remain unruffled by losses and curb them through proper risk management. You must stay calm and composed even in the face of failures and patiently wait for your next market opportunity.

  2. Know the Basics: In order to trade successfully you need to learn as much as you can about the markets. Develop strong knowledge of the fundamentals in order to be able to adapt to all market conditions. Nowadays there is a wealth of information easily available online for free. Also, you can try out your strategies in a demo trading account without risking any real money. It will help you to become a better trader.

  3. Keep a Record of Your Trades: Tenured professionals always maintain a log of their trading performances which they keep going back to in order to assess and gain a better perspective of their previous trades. Thus, they can analyse their trading history and realise where they went wrong and rectify their weaknesses. You should be passionate about trading because otherwise you will never be able to excel in your trades.

  4. Understand the Maths Behind Trading: Always be careful to calculate your risk to reward ratio with regard to your overall winning percentage. Through deft application of your risk to reward you may lose more trades than you win and still manage to remain profitable.

  5. Take Losses in Your Stride: Losing is okay if you can control your losses effectively by setting stop losses etc. In that way you can preserve your remaining capital by compensating for your lost money with the profits from your winning trades.

In forex trading it is quite normal to have a couple of losing trades. But by adhering to proper risk management techniques you can survive in the markets in the long run and remain profitable too despite your losses.

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