My leverage is 1:500. I am using 0.10 volume for my trades and my target is only 30 pips per day but still its very hard for me to reach there. I was thinking that if I open my positions on 0.30 volume and even if my one trade is successful I ll make 30 dollars on 10 pips only instead of 30 pips.
So my question is that is it ok to go for such volume on a 5000 account? I mean what is the best volume one should use for a 5000 account and also how many positions I can open?
Please Reply.
Thanks!
If you’re new to forex trading, you want to use a lower leverage until you actually know what you’re doing. 10:1 or none at all. Whether or not a 500:1 is appropriate is going to depend on your own appetite for risk. The answer to your question is going to also depend on what kind of strategy you’re trading. Leverage is a double-edged sword. You can make a lot but you can lose a lot much easier. It’s far easier to lose money in forex than make it.
Leverage, as Michael pointed out is a double edged sword…review the basics, the info on leverages, margin, open positions, margin calls and you’ll get a good idea on how to streamline the process from low-high leverage, how many positions to open, etc.
And on the risk %, it depends on the individual trader…I know some newbies who opted for 1:1000 and wiped out their account within 2 days, so start small and track your progress, good luck.
Thanks a lot for the replies guys. Yes I am a very cautious person and I am not greedy too. I just want to earn consistent small profits through Forex. What I need to know is that according to your personal experience or just take it this way that if you have a USD 5000 account to start your trading then at what volume you would open trades? 0.10, 0.20, 0.30 or higher?
Is this what you’re looking for?
$5000 act Balance
500:1 Leverage
$100 2% Risk
100 pips SL if trading in Mini Lots
1000 pips if trading in Micro Lots
1 Lot size if opening Mini
10 Lot size if opening Micro
$20 set aside if you open 1 mini or 10 Micro to cover margin
I started with 500:1 after a couple of bad trades, changed leverage to 100:1. I’m testing that and will reduce if need be. A lot of the above and what other people are telling you depends on whether you’re a : scalp, day, swing or position trader. The main goal is always protect the capital. No capital. . .No trade.
Hope this helps
Gp
Forget about leverage and concentrate on the percentage of your account you should be risking per trade.
Leverage is a byproduct of risk.
If you have a $1,000 or $100,000 account size, you don’t enter a trade based on leverage available.
As long as your risk per trade is sensible, then leverage will follow from this decision.
In hindsight, the more of your account you risk per trade in relation position sizing, the greater the leverage you are using.
Also, don’t get confused with leverage available and used leverage. Just because you open an account with potential 1:100 leverage, it does not mean you are using 1:100 leverage on each trade - a common mistake by many new traders.
Actually will second Jezz’s reply and to note, risk management is essential so set it accordingly. And remember to track all your trades - granted you’re going to lose a few but it will help you streamline your strategy, good luck!
Whatever you feel comfortable with. Everyone will answer it in a different way, some go small others like it bigger and every single configuration can be very successful. All the questions you asked depend on the individual and since you are unsure you may want to deposit a smaller amount until you figure out what works for you. On the other hand you said you wanted to deposit 5K so I am not talking you out of it. The problem with taking advice about your questions is that you will get answers from traders and what works for them which may not work for you.