Forex Trading - 4 Simple Ways to Supercharge Your Profits

By: Kelly Price

If you are trading forex, you want to make big profits and if you are new or not enjoying the success you want, then these simple forex trading tips will help you increase your profitability.

Some of the tips below are not commonly held beliefs by the majority of forex traders - but don't let that worry you the majority lose!

Here are your simple ways to supercharge your profits.

1. Learn the 80 - 20 Rule

If you don't know what it is then in essence its 80% of your results come from just 20% of your efforts.

In marketing many sales forces see 20% of their clients produce 80% of their revenue; forex trading is similar and for most traders the next statement is true:

80% of your profits come from 20% of your trades.

The fact is many traders trade to much - don't make this mistake!

Be patient and wait for the best opportunities.

There is no correlation between trading frequency and profits.

Trade less. I know traders who make 100% + annual profits and trade less than once a month.

2. Load The Trade

I hear a lot about risking just 2% if your equity - ok if your trading a seven figure sum - but for smaller traders, taking such a small risk means their guaranteed to be stopped out by normal volatility.

If you have a trade that looks good, load it up.

Risk 10 - 20% and go for it.

This is not being rash, its taking a calculated risk, when the odds are in your favour. Better to trade one great trade and risk more, than risk less on marginal trades, where you're almost guaranteed to lose.

3. Don't Diversify

Diversification is the buzz word of the investment community, it can cut risk but it also cuts profits to.

Again the small trader (under $100,000) shouldn't bother, just pay attention to points 1 and 2!

4. Don't Trail Stops to Quickly!

A common error. If you do this you will NEVER get a big forex trend profit.

I see people looking for 10 and 20 pips -compete waste of time. When I trade I go for at least a few hundred and on a big trend can bank a 1,000.

I am prepared to trail my stop way behind volatility, that short term can drop my equity - but I have my eyes on the bigger prize.

I use a 40 day moving average a lot of the time and don't mind giving a bit back at the end. Keep in mind forex trends ( the big ones) last for months or years and if you caught just 50% of them, you would make a lot of money.

As you can gather forex trading with the above tips is all about taking risks - not being rash but taking calculated risks at the right time when the odds are in your favour.

Forex trading involves risk - learn to love it not be frightened of it and forex trading success can be yours.

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