No Bullshit Forex Blog, A Part of No Bullshit Network

Let’s say that I told you my target batting average was 40% which means I’d be happy getting only 4 out of 10 trades right.

For my risk/reward I am going to go with 1:3—This means for every dollar I risk my profit will be $3. The max I want to make on a trade is $300

Here are my trading results for week one

Trade 1: -40 Pips

Trade 2: +20 Pips

Trade 3: -60 Pips

Trade 4: -120 Pips

Trade 5: +90 Pips

Trade 6: +10 Pips

Trade 7: +50 Pips

Trade 8: -50 Pips

Trade 9: -40 Pips

Trade 10: -80 Pips

Totals: -390 Pips in losing trades and 170 pips in profitable trades. (not looking so good….) A pip loss of -220

Remember the Money management rules???

Here is how each trade would break down:

Trade 1: -40 Pips= 0.25 Lots Traded (Each Pip Move - $2.50) -$100

Trade 2: +20 Pips= 1.5 Lots Traded (Each Pip Move = $15) +$300

Trade 3: -60 Pips= 0.16666 Lots Traded (Each Pip Move = $1.67) -$100

Trade 4: -120 Pips= 0.08333 Lots Traded (Each Pip Move = $0.83) -$100

Trade 5: +90 Pips= 0.3333 Lots Traded (Each Pip Move = $3.33) +$300

Trade 6: +10 Pips= 3 Lots Traded (each Pip Move = $30) +$300

Trade 7: +50 Pips= 0.6 Lots Traded (each Pip Move = $6) +$300

Trade 8: -50 Pips= 0.2 Lots Traded (each Pip Move = $2) -100

Trade 9: -40 Pips= 0.25 Lots Traded (each Pip Move = $2.50) -100

Trade 10: -80 Pips= 0.125 Lots Traded (each Pip Move = $1.25) +$-100

As you can see with the money management in place, we made a profit of $600!!

This is why when someone says “I make 100 pips a week” it does not impress me very much. We actually lost 220 pips in the above example and we still made money!

It is best to focus on risk/reward, and set your lot size based of your stop loss/target prices.

For more info on private placements and managed forex email info@fxfidelity.com

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