How to Double Your Profit in Forex Trading
What every trader wants to achieve and get is to get profits from the capital that has been poured out. However, the question now is what is the most appropriate way to increase profits? Of course, there are lots of techniques or tips that you can learn to double profits with forex trading. Moreover, at this time retail traders have been facilitated with special facilities offered by forex brokers in the form of leverage; this allows traders to open positions with more affordable capital.
However, is there a specific recipe that is most recommended for getting maximum profit in forex trading? Reported by WeTalkTrade, here are some proven methods that are useful for doubling profits in forex trading:
Trade in the long run
The simplest way to double profits with forex trading is through a long-term trading scheme. You do not need to be too active in following price fluctuations on charts or learn various trading techniques that tend to be complicated.
On the other hand, you can open an account and trade on a pair with a high swap rate difference. Thus, profits are not only collected from the difference in price movements, but also from the accumulated rate of the pair itself. This strategy is also known as Carry Trade.
Risk / Reward Ratio 1: 2
Do you know? Forex trading allows you to set the maximum loss and profit levels according to your ideal tolerance limits, and apply them on the trading platform so that execution can run automatically. Facilities that allow this are Stop Loss and Take Profit.
Many traders then use these features to determine the ratio of loss and profit (Risk / Reward Ratio) so that trading results can provide more consistent results. If your ratio is set at 1: 2, then you can double profits in 35 transactions.
A ratio of 1: 2 can mean that you will get a profit of 2x times any loss you might get. For example, with initial capital] forex trading of $ 1,000, the scenario is:
|
Opening Balance |
1000 |
Trade 18 |
1428 |
|
Trade 1 |
1020 |
Trade 19 |
1457 |
|
Trade 2 |
1040 |
Trade 20 |
1486 |
|
Trade 3 |
1061 |
Trade 21 |
1516 |
|
Trade 4 |
1082 |
Trade 22 |
1546 |
|
Trade 5 |
1104 |
Trade 23 |
1577 |
|
Trade 6 |
1126 |
Trade 24 |
1608 |
|
Trade 7 |
1149 |
Trade 25 |
1641 |
|
Trade 8 |
1172 |
Trade 26 |
1673 |
|
Trade 9 |
1195 |
Trade 27 |
1707 |
|
Trade 10 |
1219 |
Trade 28 |
1741 |
|
Trade 11 |
1243 |
Trade 29 |
1776 |
|
Trade 12 |
1268 |
Trade 30 |
1811 |
|
Trade 13 |
1294 |
Trade 31 |
1848 |
|
Trade 14 |
1319 |
Trade 32 |
1885 |
|
Trade 15 |
1346 |
Trade 33 |
1922 |
|
Trade 16 |
1373 |
Trade 34 |
1961 |
|
Trade 17 |
1400 |
Trade 35 |
2000 |
Of course, the above scenario only applies if you don't experience a loss or drawdown. Therefore, make sure you have practiced a lot on demo accounts and found the ideal trading strategy before trying to double profits with real accounts. The calculation of 35 transactions is only a minimum estimate to double profit.
In reality, there is no perfect and 100% accurate trading because the market moves fluctuatively according to the sentiments of market participants. For that, do not be rigid in targeting the number of transactions that need to be opened. As long as you are disciplined in applying Risk / Reward Ratio and not violating the rules in other trading plans, then transactions as much as 50 times, 70 times, or 100 times are fine. However, getting a profit 2x greater than the initial capital is a long-term goal.
The final word
Trading forex with a long-term perspective is considered safer than you expect daily profits. Because basically, price movements in the forex market are so volatile that it is impossible to claim that today's price movements have met the highest expectations that could double your profit.
If the next day the price turns out to show a more profitable movement, of course you will feel less than the maximum in utilizing trading opportunities. This can happen continuously so that there is a risk of triggering overtrading.
For this reason, a long-term target such as doubling profits requires a strategy with a long-term perspective as well. You must practice patience and discipline to collect profits according to the rules in the strategy you are running. In addition, it should be noted that the greater the capital you trade, the greater the risk and the longer the time period needed to double the profit.
