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SUPER AND** RETIREMENT From an easy to understand low-fee super fund to self-managed super and investments, there are many options available when it comes to planning for your retirement. --> ## How much of my money am I risking? ### You are Only Ever Risking 20% of your Starting Capital When it comes to Risk Management we are the best in the business! We’ll show you how to keep your draw-downs to a maximum of 20% of your starting capital. That means if you stick to our Capital Management system and if you’re starting with a: $5, 000 trading account then you’re only ever risking $1, 000.
$10, 000 trading account you’re only ever risking $2, 000.
$20, 000 trading account you’re only ever risking $4, 000.
Trading isn’t like going to the casino where more often then not your risking all of your cash. Risk is measured and quantified before each trade.
The extra cash in your account basically provides a level of comfort that you’re not going to lose your money and also provides ample room to leverage the market at 10:1 to begin with.
A persons risk appetite is extremely personal and is usually shaped by their personalities and background.
We’ll show you how to harness your risk appetite whether it be big or small to maximise your trading opportunities.
As a general rule, the level of risk you take depends on your starting capital, current performance record and overall confidence in the market.
You need to know when to increase your risk and when to decrease it. This is what we call dynamic capital management and is the cornerstone of our program.
No matter what your temperament, exposing your hard-earned savings to any kind of risk will always be a bit scary – especially if you’re doing it for the first time.
Some simple strategies to reduce risk that even the professionals still follow include:
Think long-term: While there are exceptions, fluctuations in the value of your trading should even out over time, so the longer you stay trading, the less trading risk you are exposed to.
Choose the right trade size for you:** Thinking about your goals, how soon you want to access your money and how likely you are to worry will help you decide what trade size is right for you.
Don’t put everything you’ve got into one trade: Spreading your money across different trading opportunities will diversify your portfolio and may protect you from sudden market falls and deliver more consistent returns over time.
Learn how things work: The more you understand about capital management and the financial markets, the better you’ll become at choosing the right trading opportunities for you. You’ll also be less likely to act blindly on a tip you might hear from a family member or friend, without first doing your own research.
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Traders4Traders (ACN 139 140 373) is authorised and regulated by the Australian Securities & Investments Commission (ASIC) AFSL number 414349. The risk of loss in forex trading can be substantial. You should, therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage that is often obtainable in forex trading can work against you as well as for you. The use of leverage can lead to large losses as well as gains. Past performance is not indicative of future results.
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The bottom line: Trading involves risk. Past performance is not indicative of future performance — nothing here is financial advice, and no outcome is guaranteed.
Written by Brad Gilbert, Founder & Head Trader at Traders4Traders — 36 years of institutional FX experience, mentoring 1,000+ traders since 2009.
The Game-Changer Trading System gives you the same tools the desk uses every day.