Miss PIPa, YW
You said some weeks you get 5% and others not so much. That is not the cause of your trading system, so I would think twice before making a big change to it. There is two main reason that that type of inconsistency happens.
- The market changes and the trader doesn’t adjust to it.
- and the more common reason is improper cash management with sizing and leverage (the number of trades).
for my leverage I do not risk more than 1% per trade and usually a lot less than that, trading at, 02 lot. Let us also remember that your potential loss and the 1% is calculated from your stop loss to the entry price. BP has a good position size calculator. This is especially important for new traders that do not have a multi-thousand trade track record yet or even hundreds useing the same strategy. This is very important so that the trader will have road signs for what to adjust in there strategy.
Now as a trader matures and the size of the account grows in confidence and experience from consistently profitable trading then its time to look at sizing because that’s where the real money is made. But first, a trader must learn emotional maturity and how to avoid gambling.
These two podcasts are simple and right on the mark.
Trade Like a Casino for Consistent Profits by Adam Khoo
Trade Like a Casino Part 2: Creating a Profitable Stock Trading System
I trade in three accounts so that I can keep my journaling separate by trade type.
- scalping, 5-10 pips per 2, overnight 50 pips per and 3, day trades 1-15 pips per.
Also when your new or trading real money whats the best way to work out of a loss? make sure it was a small loss to buy keeping your sizing low.
More about record keeping later on, but first you must have a written down trading plan with rules. The tighter the strategy is the better you will be able to duplicate it every trade. Precisely define your entry trigger and exit reasons.