eToro – Forex Trading Forum

[Patrick]

Okay so you deposited US$1000 for your trading. You started by trading US$100 per trade. Profit was good. Soon you have amassed a capital of US$1500. Then you decide \"Well, this is easy. I might as well increase my lot per trade to get more profit faster.\"

So you increase to US$200 per trade. Then in no time you hit US$2000 in capital and you decided to increase to US$500 per trade. Things seem good initial and then one trade start to go against you and you suddenly see your US$500 trade dropping fast, very fast. Your heart beat increase and you suddenly don't know what to do except seeing the trade hit a stop loss. Bang... there goes US$500. Then you throw in another US$500 trade and same thing happen. Now frustration set in. The monitor in front of you look blurry. You start to do stupid entries to try to recover your loss and your losses mount.

This is exactly what will happen when you trade more than you are comfortable with. I knew it because I experienced it before. There is a reason why you are successful at US$100 compared to US$500. Because at US$100, you are far more resistance to emotional breakdown should the trend goes against you and are more clear whether you should wait it out or to buy a reversal. With US$500, not only you are emotional affected, you also do not have the ammunition to do a reversal should you want to.

So trade within your means.

[annet1983]

some people start trading with the money they cannot afford to loose i personally think thats is the biggest mistake.Only if all your billas are paid, rent /food, u have some money put aside, like 6 months of expences, then u take 510 persent of it , thats gonna be you r trading money , with it, u van try start trading.