Most of the time, forex traders like to trade in big position size for a bigger profit. But you should not do that, as trading in big position size will only keep your money at more risks. If you want to make consistent profit in Forex, you should always trade the market with small position size. For this very reason, the professional traders in the United Kingdom always trade with small lot size. It’s not that they don’t have the money to place big trades but it’s only because they care about their hard earned deposit. If you can place quality trades then with a small amount of money you can easily make a huge amount of profit in the financial sector.
In our article, we are going to tell you the bright side of trading in small position size. Keep in mind, professional traders trade in millions because they have got the money and experience from their trading. Also, they are protected from the market volatility because they have developed an excellent risk to reward ratios. If you are thinking of trading in big positions in Forex, you should read this article. It can change your mind. Position size may affect your profit growth in your trading in the market. With right position size in your trades, you can make a good amount of profit in the market.
Big positions are riskier
Although trading in big positions will give you a large profit, it will only happen if you make it. But if single trade hit your stop loss then you will be one of the big losers in the exchange traded funds community. The new traders often lose more than 50 to 100 percent of their trading account in single trade due to their wrong position sizing. Trading in big positions will need the traders to deposit big amount of money in Forex account and extreme level of knowledge. Though you can take the help of Forex leverage, you should not use it as it will only make your career lengthier.
Many traders in the market use a small deposit to trade the market. When you are making a big trade with big positions, if you lose, all your money will be lost in the market. This market has only 5% traders who are successful and making a consistent profit. If you are not ready to lose your money in the market, you need to place your trade in the market with smaller position size. Smaller position size may give you less profit than the big position traders, it will also keep your money and preserve your capital in the market.
Learn price action trading strategy
Though there are many different kinds of trading technique price action trading stem is one of the most profitable ones. Even the expert traders at Saxo also use this system to place quality trades at the key support and resistance level. But some novice traders often use the highly reliable candlestick pattern in the lower time frame for high-frequency trade execution. But in order to make a consistent profit, you need to remain focused and execute the high-quality trades in favor of the prevailing trend. And always remember to follow proper risk management plan in every single trade to ensure your survival in this industry.