i have read several articles on money management and many topics posted here on this site.
i am also practicing 2 methods on a
demo account....
my understanding is that before i decide to trade a method the risk reward should be above 1. This sets my standard and acceptance of the method and not necessarily about each individual trade.
i will use the risk as my stop and the reward as my profit limit....but my decision to enter and exit a trade will be based on the signal and conditions of the trade.
why?
risk reward comes from past information and so does a mthods win %.
therefore on any given trade something to the contrary may happen....
if i am comfportable trading the method i trade....
then during the trade if my signals tell me otherwise before i reach my profit I take the profit....this may hurt my overall profitability however it allows to focus on another trade another day.....the same can hold true on the loss side if the trade goes against you.
one trade is a micro event
risk reward and win percent are more macro events so you must becareful in intertwining both "Maths"....
i would love feedback on my thoughs as i am just a beginer
dave
Licensed Brokers
Linear Mode
