FX Training: Money Management when Trading with EAs


FX Training is a must before trading!

Alright, traders,in this lecture, I wanted to talk about money management because this is very important especially if you are a beginner trader. And when taking your FX training you need to pay attention to that.

Because having smart money management will keep you longer on the market and most of the beginner traders blow their accounts because exactly of not having good money management. And this is what I want you to remember from this lecture. For the purpose of this article, I will show you an example of an account. I started with 10,000 and now I am at 11,000.

This is a free lecture from the Forex Trading Strategies from a Professional Trader + Top 5 Professional EA.

This means that for 1 week or just a little bit longer, I have 10% of the account which is a very good result. And I don’t say it will happen to you when you start trading, that you will have the 10%. Maybe it will be less, maybe you will end up the week losing, it really depends on the market. That’s the one thing you should remember as well, that the results are not always the same. But the better FX training you have, the better results you will achieve.

So we don’t have 1 week similar to the next week or to the previous week. Sometimes we have a good week, sometimes we have a bad week, that’s the market. But the most important thing is that we maintain good money management. In a $10,000 account, what I wanted to show you as an example in this course, I’m trading the Expert Advisors with 0.1 lot. This means that in my account I am blocking about $100 for each trade, 100 and something, like 110.

5 open trades are normal for an account

Because you see I have 5 trades opened at the moment,

fx training for the course
The 5 open trades

with 0.1 and the margin I am using is 549 which is about $110 for each trade. And this is 1% of my account. Or when I started with 10,110 is just 1.1%. And if all the Expert Advisors open trades, which are 5 Expert Advisors but 2 of them, the GBPUSD and the USDJPY, you can add to the position if you want to. From the Expert Advisors, Properties, you can select if you want to add.

properties for the account
Go to Expert Advisors then Properties

If you don’t want to add, you just leave it as it is. So it will not add to the position because the maximum position amount will be 0.1. I keep it 0.3 so I add 2 more times.

fx training on EAs
I keep it at 0.3

So if all the Expert Advisors, the 5 of them open trades, and if the USDJPY and the GBPUSD add to the position, I will have a total of 9 trades opened. And each one is 0.10, I will be at 0.9 lot which will block me about $1,000 from the account. That is the maximum I can have and that is what you need to calculate in your FX training before you open a real account.

Each 110, 9 times, it will be about 990. So about 1 complete lot in a $10,000 account which is 10%. But keep in mind something, I’m not risking 10%. I will have the margin at 10% or at $1,000. This is how much it will be blocked from my account to open the trades. The rest will be a free margin like what we see at the moment.

FX Training: Stop Loss is the real risk

So if at the moment all the Expert Advisors open trades, I will have a blocked margin about $1,000 and the free margin will be about $10,000. So this is how much I use from the account to open the trades, but I’m not risking that much. I am not risking 10%, I’m risking a much lower amount. Because the risk is how much you are able to lose. How much the Stop Loss is.

And if you go through the Expert Advisors when you are learning them and doing your fx training, you will see that each Expert Advisor has a Stop Loss lower than 100 pips. In this case, for the USDJPY, for example, we have 70 pips.

USDJPY has Stop Loss of 70 pips

And actually, looking at my account history, I don’t have a loss bigger than $100. All of them are less.

So what I wanted to say is that if you have all Expert Advisors opening trades and they all hit the Stop Loss, this is like the worst-case scenario, you will have a loss lower than 10%. That is something that every FX training education must teach you.

Because it will be 10% if all of them have $100 of a loss with 0.1. With 0.1, if you have 100 pips of a Stop Loss, this will be approximately $100. But, one more time, because all of the strategies have Stop Loss smaller than 100 pips, it is less than $100, and it’s much less than 10% if you combine them all. I will leave that to you.

The worst-case scenario matters

And this is like the worst-case scenario, one more time, if all the Expert Advisors open trades and if all of them hit the Stop Loss. Now, from my experience, this will happen very rarely. It’s not something that happens every day, every week or even every month.

But, one more time, I wanted to say that this is smart money management because I’m never risking more than 10% of my account. So I will just summarize it one more time. If I trade with a $10,000 account, I would be trading with 0.1. So if you are trading with $1,000 of account you can trade with 0.01. And if all of the trades open positions, I will use 10% from the account which will be about $1,000 in this case.

But the worst-case scenario when all the trades hit the Stop Loss which, one more time, is very rare or it might never happen to you, not while fx training and not while real trading.

It will be even lower than 10% because all the Stop Loss are below 100 pips. I hope that’s clear now. And I don’t want to show you how much is the total Stop Loss now because it will change when you’re taking the course.

Test on a Demo account while you are doing your FX Training

So I really hope that makes it clear about the money management, about how much is blocked from the account, and what is the worst-case scenario.

This is something you need to know at all times when you are trading. And the best thing to do is to test it first on a virtual account. Just practice on a virtual account. If you’re planning to open a real account with $1,000 then open a Demo account with $1,000, test the Expert Advisors for a week to 1 month, 2 months, 3 months, depends on how much time you need to test the Expert Advisors for yourself just to be confident with the results.

And don’t hurry to risk real money until you are confident with the strategies. Spend more time on FX training until you are ready. It doesn’t matter if you are trading manually with the strategies, it doesn’t matter if you’re trading automatically,

With the Expert Advisors, the most important thing is to be comfortable trading with them, to be convenient in the strategies. And this is the only time when you should be risking real money.

Feel free to ask questions

And, one more time, don’t hurry with that. I know a lot of people want to make profits quickly but it doesn’t really work this way. You need to test for a longer time, to practice and see how it goes.

Thank you very much for reading. If you have any questions let me know in our trading Forum.