Online entrepreneurs have recently turned to the forex markets in their droves because of its excellent return on investment and its tax free qualities in the U.K. Since fast internet connections and data feeds it has become possible for anyone to trade forex from the comfort of their homes. Once a profitable trading system is in place it is a simple matter of money management to ensure your business succeeds.
One of the hardest aspects to deal with when trading forex is dealing with losing trades, unfortunately these are inevitable and need to be dealt with accordingly. Losses like any other business need to be calculated at the end of a period and put down as outgoings. In this business there are no costs such as staff or stock so a losing trade is just stock that you couldn't resell.
Managing your trading balance is the key to long term success and should be dealt with a business mind set. You should not risk anymore than 2-5% of your trading balance on anyone trade, reasons for this will become clear when you do the math. For the next paragraph imagine you are trading with a system that has an 80% success rate.
In this scenario we are going to start with a £1000 balance and trade at £1 a pip if we didn't want to see our balance depleted we would be looking not to risk any more than £50 a trade. That way we could lose 20 times on the run before our balance was depleted. It is simply a numbers game and as long as you have an 80% success rate you will not lose.
When you have got to the stage of having a system that has the desired success rate and you stick to the money management plan. All you need to do is sit back and let the figures go to work, remembering to stick to the trading and money management plan will see you successful over a period of time.