Suggest me Money/Risk Management method - page 2

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Based on your concerns, I suggest you consider the following risk/money management methods to help improve your trading strategy:

1. Position sizing: Use a consistent percentage of your trading capital for each trade. For example, you can risk 1% or 2% of your account balance per trade. This helps to limit your losses and keeps your risk consistent across different trades.

2. Risk-Reward ratio: Maintain a favorable risk-reward ratio, like 1:2 or 1:3, to ensure that your potential profits outweigh the risk of loss. This way, even if you have some losing trades, your overall trading performance can still be positive.

3. Use trailing stop losses: Trailing stop losses help lock in profits as the market moves in your favor. This can help prevent the market from reversing and hitting your stop loss after a favorable move.

4. Hedging method: Opening an opposite position can help mitigate your risk, but it's essential to have a clear plan for when to open and close the hedge position. One approach could be to open the hedge position when the price breaks a key support/resistance level, and close it when the price reaches a predetermined profit target or when the market shows signs of reversing.

5. Scaling in and out of positions: Instead of entering or exiting a position all at once, you can scale in and out by gradually increasing or decreasing your position size. This can help you manage your risk and take advantage of favorable market conditions.

Remember, there's no one-size-fits-all solution for risk and money management in trading. It's essential to find a method that works well for your trading style and risk tolerance. By incorporating some or all of these techniques into your trading strategy, you can minimize losses, maximize profits, and better manage your trading risks.
 
Trading is a process of learning from mistakes, and you are the one to decide
 
Rodger Sen:

I dont have any problem in technical analysis on 1minute chart but i trade with big size stop loss, which has following problem

1. Sometime it takes hours and waste my time as price just hovers between my stop loss and entry area

2. As per screenshot, If i place stop loss above the 1st arrow's candle high then price comes back and hit my SL and then continue the trend so despite my levels being accurate, I lose opportunity of making money

Now i want to trade with small size Stoploss just a little bit above or below the candlestick where i enter but price comes to hunt stop loss


If I shift my SL a little bit more far away then it mess up risk reward 

so please suggest me any hedging method or money management method which can be suitable to solve these problems 

I am thinking to open a opposite position but need to know when to open, based on breakout or based on high break? and when to close this hedge position in condition as suggested on screenshot

Look at this tutorial series https://www.youtube.com/playlist?list=PLv-cA-4O3y979Ltr9wQ2lRJu1INve3RCM

 
Anil Varma #:

Look at this tutorial series https://www.youtube.com/playlist?list=PLv-cA-4O3y979Ltr9wQ2lRJu1INve3RCM

Thank you

 
You're tackling challenges many traders face. Here are some more detailed insights:

1. Scaling Positions: Rather than entering a trade all at once, break your position into smaller parts. This allows for multiple stop loss levels and could offer more flexibility in trade management. For example, if you're buying, enter the trade at different points as the price dips.

2. Averaging Down/Up: If the price goes against your position, consider buying (or selling, if short) more at the new price instead of closing your position. This reduces the average cost of your position, but be cautious as it can increase risk if the price continues to move against you.

3. Hedging: When your stop loss is close to being hit, consider opening an opposite position. This can offset potential losses. For instance, if you bought EUR/USD and the price is falling towards your stop loss, selling EUR/USD could help. Be aware, hedging can be complex and requires a thorough understanding of the market.

4. Dynamic Stop Loss: Regularly adjust your stop loss according to market behavior. If the market is in your favor, you can shift your stop loss in that direction to protect profits. However, this approach necessitates consistent monitoring.

As for deciding when to open or close a hedge position, consider the overall market trend and the strength of the price movement. In an uptrend, you might open a hedge position if there's a strong downward breakout and close it when the price resumes its upward trajectory. 

Remember, these strategies come with their own risks. Always backtest your strategies before implementing them in your live trading. You're on the right track by seeking methods to manage your risk more effectively. Keep refining your approach.
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