What is the 2% rule and why is it important?

One of the most important lessons every trader should observe is risk management. This is the difference between keeping and making more money, or losing money and going broke. It may sound like an easy, straightforward principle, yet it is still one that most often violated rules that traders either forget or ignore. Therefore, to help anyone new to the industry stay from losing all their money, a simple to follow rule was coined the 2% rule.

How does this 2% rule work?

It is very simple actually; just don’t risk more than 2% of your account balance on a single trade. For example, if your account balance is $10,000, no single trade should have more than a $200 margin (2% x 10,000). With every subsequent trade, you keep limiting your risk to 2% of the remaining margin, rather than sticking to the original $200. Therefore, on the second trade, had you lost the first trade, your maximum risk would now be $196 (2% x $9,800).[Continue Reading…]

Why is US dollar traded most in Forex?

Many people think why our dollar is traded most in the Forex market. There are lots of other currency in the world and you will be surprised to see that one currency is dominating the world. When there are major and minor currencies in Forex, there are many other currencies that are not traded on the market as like the US dollar. If you have not known, this one currency dominates more than 80% in the global Forex transaction and this Us dollar is also one of the strongest currency in the world.  This article will tell you why this one currency is traded most in the world and if you can get any advantage if you are trading with the US dollar.

Before you dig into more details we are going to give you some amazing piece of information. Peoples in the United Kingdom are getting involved in spread betting very fast. Most of the professional brokerage firms are offering high leverage trading accounts to their clients. So if you can trade the market with the extreme level of precision then you can make a huge amount of money. But mastering the art of trading is not all easy. You have to learn all the basic details of this market from the scratch.[Continue Reading…]

Why the expert consider trading as their business

Why do we have to think like the businessman? Why can't we think of someone else? Well, the main reason why the traders in the United Kingdom are succeeding because they trade like a businessman. They consider trading as running a business. Most of … [Continue reading]

What are joint funeral plans?

Prepaid funeral plans have gained considerable popularity as funeral costs have rocketed year on year. At a time when the cost of the average funeral in the UK has risen as much as 70% in the past decade – a rate far greater than increases in wages … [Continue reading]

The lowdown on robo-investment

There is a lot of hype about robo-investing; that is to say, handing control of your savings over to a robo-advisor, who will then invest it on your behalf. On the surface, it does sound a little crazy. Why would you relinquish control of your cash … [Continue reading]

Some common misconceptions among the new traders

forex trading

People are amazing in nature. Once they decide that they will do something it’s really hard to change their decision. Similarly, when it comes to trading this very human nature causes huge loss to the traders. Some even consider trading as one of the … [Continue reading]

Don’t Dismiss Personal Financial Planning

Personal Financial Planning

With so many daily demands pulling at your personal finances, it is sometimes hard to step back, taking-in the big picture.  Yet despite the importance of addressing immediate needs, it is nonetheless vital to account for your long-range financial … [Continue reading]

Which area of the UK is best at saving?

Check out the infographic below to find out which regions are saving most when it comes to pensions. The infographic is provided by True Potential. … [Continue reading]

Understanding Forex Trading Signals and how they work

Forex Signals

One thing that you need to be conscious of when you are engaged in trading on the foreign exchange market is that there are two vital components necessary from the very beginning --- a combination of a well-formulated winning equity management … [Continue reading]