Hey, I'm new to trading forex and I've just been messing around with it for a month or so, normally i'm a stock trader.
However, I've read some books but none of them mention specifically how to make the more basic calculations of risk...focused more on fundamentals and
technicals.
Ok so lets say I open an account with $1000, a micro account meaning im buying 1000 units per lot.
I want to risk only 1% of my $1000 per trade --> 10 dollars (yea i know its dumb but just an example)
I'll also be using the standard 100:1 leverage.
For calculations:
So my questions are: to risk exactly 10 dollars in a trade, how many pips below the entry must my stop be?
How much is each pip worth?
I'd like to do the standard calculations of risk for the following
usd/cad - 1.1
eur/usd 1.3
gbp/eur 1.9 (into usd)?
notice how they're all with different base and quote currencies so I have to convert them, then calculate:
1. maximum amount to buy in trade risking 1% of my thousand dollar account at 100:1 leverage (including conversion) +
2. converting profits into us dollars
3. number of pips to place the stop loss correctly
I realize there are posts that explain this but I feel like a walkthrough would be more helpful. Thanks to anyone who offers to help!
However, I've read some books but none of them mention specifically how to make the more basic calculations of risk...focused more on fundamentals and
technicals.
Ok so lets say I open an account with $1000, a micro account meaning im buying 1000 units per lot.
I want to risk only 1% of my $1000 per trade --> 10 dollars (yea i know its dumb but just an example)
I'll also be using the standard 100:1 leverage.
For calculations:
So my questions are: to risk exactly 10 dollars in a trade, how many pips below the entry must my stop be?
How much is each pip worth?
I'd like to do the standard calculations of risk for the following
usd/cad - 1.1
eur/usd 1.3
gbp/eur 1.9 (into usd)?
notice how they're all with different base and quote currencies so I have to convert them, then calculate:
1. maximum amount to buy in trade risking 1% of my thousand dollar account at 100:1 leverage (including conversion) +
2. converting profits into us dollars
3. number of pips to place the stop loss correctly
I realize there are posts that explain this but I feel like a walkthrough would be more helpful. Thanks to anyone who offers to help!