Disliked{quote} Bob, would you mind telling me what leverage level you trade with?Ignored
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Disliked{quote} Bob, would you mind telling me what leverage level you trade with?Ignored
DislikedA conversation between my wife and I: See, the way I look at it is.. Well, think of all these people across the world on these Forex forums. They all want to be wealthy, they all want to run successful businesses through trading. Everyone thinks they're a bad-ass, everyone thinks they're on some amazing, ideological journey toward "financial enlightenment". But here's the thing, if I gave you a million dollars to start a cleaning business (my wife runs a large cleaning company) - how long do you think you could stay in business if no one ever paid...Ignored
DislikedHere is a post at another forum where I explained the deceptiveness of high leverage accounts. I hope this makes it clearer to you. We have had a similar discussion before so let me hit on two issues you have brought up. High leverage deceives you on the amount of funds you have available to trade. You will see the percent of the account put into play is very low with high leverage when in reality you have too much funds committed to lots. Yes you can just use small lots and still use high leverage but when you look at the figures at the bottom...Ignored
DislikedThe second issue is swap costs are the same, or the interest rate is the same whether you have high/low leverage. That also is a big deception. WHY? Because the interest rate maybe the same but the amount you borrowing is far different. If I put 400,000K in play with my 1000 dollars 400:1 leverage or I can only play 25K into play with 25:1 leverage, the interest or swap is the same but the amount you are paying compared to me is a BIG BIG difference. 10% interest on 400K over one year is 40,000 dollars. 10% interest on 25K over one year is 2500...Ignored
Disliked{quote} I have a USA account that is 25:1 and 50:1. I plan on doubling my funds and going down to 20:1 or even 10:1. As my account grows I have been lowering my ratios. I also do not oppose traders with small amounts of capital trading high leverage with sums less than 500-1000 dollars. I call it tuition money where they learn how to trade. At some point you have to learn this business and you will pay tuition. The smaller the amount the cheaper the university of learning. However, when you get to trading large amounts you should get rid of the...Ignored
Disliked{quote} I think you have explained it well. If trading AUDUSD as an example I would conclude it would currently be good to use a high leverage account for longs and low leverage for shorts, at least in relation to the swap effects.Ignored
Disliked{quote} I have a USA account that is 25:1 and 50:1. I plan on doubling my funds and going down to 20:1 or even 10:1. As my account grows I have been lowering my ratios. I also do not oppose traders with small amounts of capital trading high leverage with sums less than 500-1000 dollars. I call it tuition money where they learn how to trade. At some point you have to learn this business and you will pay tuition. The smaller the amount the cheaper the university of learning. However, when you get to trading large amounts you should get rid of the...Ignored
Disliked{quote} Ironically, my having a 50:1 account is kind of lost on a trader like me. While it is nice to have that possible leverage available (I guess), I haven't approached 10 x equity for all open positions at one time in months. Some call this conservative trading; I call it "not having a heart attack." I also like the "tuition money" concept. Best to make mistakes with the smallest amount of risk capital on the line as possible. I think my first year of trading forex resulted with my only paying a net of $100 with trying various things out (which...Ignored
Disliked{quote} I have a USA account that is 25:1 and 50:1. I plan on doubling my funds and going down to 20:1 or even 10:1. As my account grows I have been lowering my ratios. I also do not oppose traders with small amounts of capital trading high leverage with sums less than 500-1000 dollars. I call it tuition money where they learn how to trade. At some point you have to learn this business and you will pay tuition. The smaller the amount the cheaper the university of learning. However, when you get to trading large amounts you should get rid of the...Ignored
Disliked{quote} Spot on Bob! Way too many small account traders over leveraging to the hilt and swinging for the fences with 20 pip stops. Been trading very successfully for almost 2 years full-time for a living and NEVER use SL. Have a very large ($300k+) account and trade 3 Lots as standard trade. Use a lot of cross correlation hedging to balance the carry. Great thread and good to see others not following the herd!Ignored
DislikedDiversifying your account across dozens of pairs - even exotics - with small lots and low leverage gives you more control of your total position. For example: 1K lots across 30 pairs is essentially a 30K lot in a single pair. After initiating the total position, there's many ways you can manage it without a stoploss. I mean, a 1,000 point loss in any of the pairs would only be a $100.00 loss (with the exception of the exotics) per position as your majors typically have a tick value of at least 0.90 to 1.1. In the event of a total loss it's still...Ignored
DislikedDiversifying your account across dozens of pairs - even exotics - with small lots and low leverage gives you more control of your total position. For example: 1K lots across 30 pairs is essentially a 30K lot in a single pair. After initiating the total position, there's many ways you can manage it without a stoploss. I mean, a 1,000 point loss in any of the pairs would only be a $100.00 loss (with the exception of the exotics) per position as your majors typically have a tick value of at least 0.90 to 1.1. In the event of a total loss it's still...Ignored
DislikedStop Loss, below / above, EMA 144 and 169 periods is quite powerful, always managing risk their relationship profitabilityIgnored