This has nothing to do with how much you spend on groceries, alcohol and lap dances.
All quality investments to be sure – but that's another thread.
During the big dollar run thats been underway I’ve noticed a lot of people posting about losing their accounts after one or two days of trading.
This is often the result of poor money management.
I’m not going to delve too deeply into this subject but I do encourage you to read the article Money Management located on the home page of babypips.com.
A quick example below.
You’ve found the Holy Grail and you’re ready to begin rolling in the green.
The SINGLE most important facet to being in this environment long term is how you manage your cash on a per trade basis.
When you start trading real capital never risk more than 1% on each trade.
Let’s say you just deposited 5k in your trading account.
1% of 5K is $50.
Your system has a 50 PIP stop.
Each PIP should be worth $1.
If you’re trading more than 5% or more on each trade your days are numbered.
