The ultimate goal of any market trader is to make a lot of money. Forex is no different; in fact, as the world’s largest financial market, forex traders have a strong desire to grow quicker than any other market. Although there is no one-size-fits-all solution for boosting your trading account to the skies, there are a few areas worth considering. They all make account growth much faster and more efficient.
Let’s have a look at some of the things you may do to help your forex account grow much faster!
Funding Your Account
When we talk about forex trading, the amount of money you have in your control has a big impact on your profits and growth. The more capital you have, the higher your per-trade return will be. This is because your return is calculated as a percentage of the size of your account. As a result, more capital is generated with higher amounts of money. It’s how the rich seem to get richer so easily while the poor struggle to break over the poverty barrier. Nothing can be a better way than understanding for example, let’s just go through one.
Imagine a situation where your account size is $1000. With a return of 10% per trade, you will be making $100. Now imagine your account has a number of $100,000. Now imagine the situation. You’ll be making $10,000 if you can make a win. So, if you can add funding to your account, it will be much easier to grow it fast and effectively. However, there are several risks to be aware of. When live trading, if you are a beginner trader, you must start low. If you immediately began trading with all of your savings, the psychological impact would be too big.
Therefore, we propose that you add money to your account on a monthly basis. It may be a small amount at first, but over time, it will allow you to experience larger returns and expand more quickly. Consider a pension plan. Every month, you make a little contribution to your pension. You can do the same with your real forex trading account!
Your Risk-to-Reward Ratio is likely the single most important aspect of growing your account rapidly and efficiently. The ratio between your objective and stop loss is your RR. A minimum RR of 1.5 is a good number to go for. If you go lower than 1.5RR, you won’t be able to enter the trade. Let’s say you use 1 as a minimum RR, which means you need a win rate of more than 50% to be a profitable trader.
To be profitable with a 1.5RR minimum, you must have a win rate of over 40%. That extra ten percent is crucial. To cover your losses, you simply need to win two trades for every three losses. This is helpful in one area where many traders make bad decisions: chasing losses. Your mindset will be less pressured to “win at all costs,” allowing you to trade at a better level. Being a profitable trader, not a winner, is the goal of efficient trading. Trading is all about protecting your capital, and if you stick to a minimum RR, your account will grow much faster than if you didn’t.
Trade-In Different Time Frame
Though we all have a preferred time to trade, a preferred method of trading, and our own personal trading comfort zone, trading in different time frames is necessary to grow faster and more efficiently. If you’re new in trading, do take it slow. You must first learn to crawl and walk before you attempt to run. The reason We encourage you to do this is that you will be able to identify more trade setups.
Imagine this: if you only trade a one-time frame on a pair, you are only seeing a small portion of what price movement is showing you. Learning to trade on large and small time frames would provide you with so many opportunities that you’ll have to start sorting out the good from the great. Even if you’re not sure, you should start looking at various time frames.
So many traders lose interest in trading because they mentally give up and stop checking their charts. To grow your account, you must be consistent. Big wins and big strides forward do not result in account growth. It occurs as a result of minor decisions made on a daily basis. These factors add up to a steady rate of progress and a lower chance of a major setback. Do something, even if it’s as simple as checking your charts once a day to keep up with big pairs. Regular time spent on your charting leads to growth. It doesn’t have to be much but what counts is the continuous progression.
Overtrading might be profitable at times, but it is suicidal in the long run. You shouldn’t take every potential trade that comes your way. Not only because of the need for maximum account exposure but also because some are simply superior to others. Overtrading will slow down the growth of your account. Yes, we want rapid expansion, but we also need it to be efficient.
If left unchecked, overtrading lowers your efficiency significantly. So, in terms of our offensive and defensive strategies, the first two points are offensive, while the third point is about defense. Fear of Missing Out (FOMO) is linked to this, and many traders battle with it. Accept the fact that you will miss trades and that not every trade will result in a profit. But, more significantly, develop your price action analysis skills so you can choose the optimal trade from many of the options.
Growing in the forex market is a challenging task, as one may be tempted by the forex market’s opportunities. However, with proper market analysis and methods, one may easily be profitable and grow in forex more quickly with efficiency.