Money Management – The Holy Grail Forex System

Forex traders have become accustomed to trading massive broker-provided leverage. I’m often asked about my reporting and how I can have a loss in pips but a gain in equity. It’s not that difficult really. Pips don’t really count. If you are trading sensibly, and using proper money management, every pip has a different dollar value. Signal providers usually choose to report in pips instead of equity because of this. It’s much easier to be positive in pips than it is to be positive in equity.

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Here is an example of the power of proper money management:

Initial Account Value: $1,000.00

Risk: 2%

Trade 1: 200 pip SL
Trade 2: 150 pip SL
Trade 3: 20 pip SL

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