Stock markets & Forex markets by their nature, are risky. They can be unkind & treacherous. When you start trading, you start with a disadvantage – be it the broker commission or the bid-ask spread that you see every day eating into your capital. Besides that there is the market risk. So what do successful traders & professional traders focus on as an important trait? It is the Risk Management element – for them, no trade plan or strategy is complete without Risk Management.
Stop losses are a popular way of limiting your risk. But to succeed, one needs to identify & use the right (and reasonable) stop loss levels. Hedging is another way to manage risk and successful traders always use stop losses or hedging techniques. While many people know the basic concepts, application of the technique needs further study,
If you are interested in understanding the concept & how to effectively use it to become a successful trader, please click here for an online program on Risk Management.