hellow everyone i need a direct answer such as yes or no
and how to set my margin to do this…
1st i wana know if i have 500 bucks in my account can i trade at the max 5 bucks a pip or is it 50 or 5 cents?
and how do i change my setting on the market exectuion thing to to do so?
note it look like tis 0.02
Hi @jamall1989
There are two factors that determine the dollar amount you are risking per pip on a trade.
Many traders who are new to forex don’t realize the value of a pip varies from one currency pair to the next.
For example, the value of a pip when trading one standard lot (100,000 units or 100K) of EUR/USD, GBP/USD or AUD/USD is example $10. That’s because USD is the counter or quote currency for these pairs.
By contrast, the pip value for EUR/GBP is £10. The pip value for USD/CHF, AUD,CHF and CAD/CHF is 10 Fr. The pip value for USD/JPY, EUR/JPY, and NZD/JPY is ¥1000.
Most trading platforms will automatically convert these pip values into their US dollar equivalent if your account is denominated in USD, but for the sake of simplicity we will give you an example using EUR/USD.
To risk $5 per pip, your trade size on EUR/USD would need to be half of a standard lot (AKA 5 mini lots or 50,000 units or 50K). On your MT4 platform, this may be expressed as 0.50 volume.
To risk 50 cents per pip, your trade size would have to be 0.05 volume (AKA 5 micro lots or 5,000 units or 5K). To risk $50 per pip, your trade size would have to be 5.00 standard lots (AKA 500,000 units or 500K).
In another discussion, @LaughingCharlie made a good point about why you might not want to risk more than 1% of your account on any trade: How much units cost
For your $500 account, that means risking no more than $5, so even a trade size of 5 micro lots might be too big, because it only gives you 10 pips to risk. Consider trading 1 micro lot or 0.01 volume, so you can risk up to 50 pips per trade.
Thank you for the response that made since im bouta deposit the rest of this money then lol 5 bucks a pip is plenty for me right now lol
Consider how many pips you want to risk on a trade. Then let that help you determine what size trade you can place.
Hello its me again I have a forex mt4 account I put a smaller amout in 250.00 usd I only can trade 6cents max do I have to put more money in or can I I trade a daller a pip on this one?
Hi @jamall1989
Respectfully, you are asking the wrong question. We will still answer it, but we will also address the questions you should be asking and why.
Yes, with $250 in your account, you technically could trade one mini lot (10,000 units of base currency AKA 10k AKA 0.10 volume on MT4), which would allow you to risk $1 per pip. However, as @LaughingCharlie pointed out previously, you might not want to risk more than 1% of your account on any trade. See section 3 of this article to understand why: How much units cost
With $250 in your trading account, 1% would be $2.50 you could risk per trade. If you risked $1 per pip, then that trade size would only allow you to risk 2.5 pips. That’s not realistic, since your transaction costs (spread and/or commissions) would already take up around half of right when you open the trade.
It would be more realistic for your to risk 10 cents per pip by trading one micro lot (1000 currency units AKA 1k AKA 0.01 volume on MT4). Then the $2.50 you could risk per trade would equate to 25 pips.
The questions you should be asking are:
This other thread has more examples: How much units cost
it wont let me do it on my mt4 app how do i go about trading the 1 daller it only let me trade 0.06 and thats 6 cents a pip
Did you not understand our previous post? Why are you still trying to risk $1 per pip with $250 in your account?
to build my account up im skilled enough to risk that much lol
and it wont even let me risk 10 cent per pip either and the reason i would like to risk more is becuz im a nadex style trader i know exclacly where the market will go at all times as far a the pice bars
Two things:
No one knows exactly where the price will go at all times, not even central banks. Therefore, a key part of successful trading is managing your downside risk so that losing trades are small relative to your account size. That’s why we mentioned above about risking 1% of your account per trade.
Forex trading works differently from binary options, so you have to modify your risk management accordingly. Your comments suggest you do not yet understand these differences. Trying to risk $1 per pip with only $250 in a forex trading gives you only 2.5 pips to risk if you want to stay within risking 1% of your account per trade.