In Forex Trading, size does matter:

I have discovered that many people still fail i n Forex trading even with the best strategies ever. It all boils down to Forex position size, strategy might be the best, you might even be using signals which works the best but only to suffer huge losses. One thing i need to advise traders out there is that in Forex, size does matter, it plays a big role, there is no standard small lot size, it all depends on the size of your own account, what is small for my account might be very big for yours, i have used paid signals before, i don’t remember my signal provider asking me how much i had in my account, i was receiving the same signal as with everyone and the size was just standard, it is only now that i know, i can see i wasn’t supposed to use that lot size for my account, i was supposed to decrease and use what was suitable for my own balance, i lost it all and had to add more money to my trading account (talk about being naive and clueless), i don’t blame them though, it was my duty to learn, but pity this is not emphasized mostly by those teaching Forex trading. A lot of times traders who never had proper training but only trade using random information from Google, groups or forums are mostly the”victims” because when you see everyone referring to a certain lot size as acceptable size to trade, you also blindly use that size not knowing the balances on the accounts of those you follow, this is the downfall of many, i still get shocked to see people posting their statements and seeing the lot size they use for the trades. It is unfair of me to say a certain lot is a reasonable sizewhen i don’t know how much a person funded their account with.

How do you decide on your Forex position size:

Once you have decided how much you want to fund your live account with, then you can decide on your Forex position size, you can either decide on a fixed lot size (that is when you trade same lot size for every trade regardless of account size) but there is a downside in going for fixed lot size, should your account go down you might just become over leveraged, so i think the best way is choosing certain lot size but making sure you can be able to change anytime to accommodate the size of your account, if your account goes up, also increase the lot size accordingly, if you suffer some drawdown, please do adjust your Lot size (very important) to suite your current account size, adjusting Lot size according to your account is very beneficial because you will always be risking same percentage on each trade irrespective of your account size. Risking same percentage per trade takes us back to money management which play important role in you making or breaking it as a Forex trader, money management is a topic that is continuously written about, but unfortunately traders never seem to be bothered by it, hence the huge losses, however any professional trader, money manager or anyone who deals with money will agree that without sound money management system you will ultimately affect your returns or profits, i am shocked though by how the traders just gamble their way to the market, that is why they never last, making it big today only to lose it all tomorrow is the “YO YO GAME” they play, trading smaller size allows a trader to sustain far greater amount of losing trades than if they had larger lot size, try to have a set and disciplined money management strategy and stick to it.

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