Adam Horak's Blog – November 2009 Archive (4)

Money management formula



Account balance times percent of acceptable loss gives you the amount of money you are willing to lose in a trade divided by the numbers of pips in your stop equals the number of lots you can trade.





This is really is a simple calculation, but a few simple rules too follow.



1) Your account balance; account balance multiplied by no more than .05 equals (5)% of your account balance, which is the most I want to have at risk at any one… Continue

MONEY MANAGEMENT



Most beginning traders believe that a good entry into the market is the key to success. Unfortunately most are very wrong. Money Management is by far the most important criteria of trading, whether it’s stocks, futures or FOREX. Every successful trader will agree that managing your trades correctly is the #1 key to consistent profits.



Loosing a trade or several trades in a row is just part of trading, period! Having a plan and trading your plan is key to… Continue

In The News:



Traders await tomorrows release of the Economic Sentiment report by The German Zentrum für Europäische Wirtschaftsforschung (ZEW).

The report determines the sentiment of German institutional investors over the past month.



The ZEW report, which is concluded from survey of about 350 German institutional investors and analysts, is considered a leading indicator of business conditions.



A higher than expected reading should be taken as… Continue

The Federal Open Market Committee (FOMC) decision on short term interest rate is due out tomorrow (Nov 4).



The decision on where to set interest rates depends mostly on growth outlook and inflation. The primary objective of the central bank is to achieve price stability. High interest rates attract foreigners looking for the best "risk-free" return on their money, which can dramatically increases demand for the nation's currency.

A higher than expected rate is positive/bullish… Continue