Forex trading : How much money can we earn with 10 $ of risk per trade ? :


In forex trading, it is usually not possible to predict how much money one can earn on a day, a week, a month or even a year. Financial markets are far from predictable and therefore trading opportunities and profits also. If your trading strategy is trend tracking or if it focuses on trading range, the number of trading opportunities can be more or less important depending on the state of the markets. You can very well have 10 to 20 trades per month by practicing swing trading when the markets you deal swing in range and you get more than 30 if they move in trend. It is also necessary that these operations lead in part to a profit.

What does it mean to risk  10 $ per trade ?

If we respect the instructions provided in the trading courses, we risk 1% to 2% of its capital per trade, not more. Assuming that we risk 2% of our capital on a trade, 10 $ of risk means that we have a capital of  500 $.

Predicting how hard to earn money is difficult

Whether in short, medium or long term trading, defining one's profit in advance is very difficult and not advisable as you will have understood, however one can know more or less how much one will win per trade . If you practice scalping or day trading, you will usually have trades whose risk reward ratio is 1 or 2, ie the potential profit is equivalent to or equal to the risk taken on the trade. In this case, if you risk  10 $ per trade, you will earn  10 $ or  20 $ profit per trade depending on your takeprofit and strategy. Traders who have higher risk reward ratios are those who practice swing trading, generally their risk reward ratio are greater than 2, they can sometimes reach 3, 4 or even 10 times the risk taken according to different parameters, Having a risk of  10 $ per trade a swingtrader will generally be able to realize  20 $ to  50 $ profit on a winning trade, sometimes even more, but note that in swing trading the number of opportunities is usually less important than on styles Shorter-term trading.

Start trading with a capital of  500 $ ?

Starting a trading career by opening a trading account at a forex broker and depositing the sum of  500 $ allows you to risk  10 $ per trade if you have a trading strategy and a money Management and this offers opportunities for interesting return on investment. Obviously, we can risk less than  500 $, we can very well start with  200 € capital at eToro and risk up to  5 € per trade for example.

Let us assume that we have  500 $, that our risk reward ratio is 2: 1 by practicing day trading a few hours a day or swing trading, that we execute 10 transactions in the month and that 70% ( 20 $ x 10 x 0.7)  140 $ , which represents 28% of the initial capital of  500 $! A trader who does this can double his starting capital several times in succession and may decide to reduce the risk to 1% or even 0.5% when the risk reaches four or five digits for example, in order to trade more serenely and with less Of pressure (because a risk of 0.5% is a margin of maneuver of 200 trades!.
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