13 Nov 2014

HOW TO MAKE MORE MONEY?



So after carefully reviewing my trade journal I've decided to do some restructuring that should help me maximize my potential returns. Here's what I've come up:


1) Opening another trading account.

Looking back over my trades for this past year I've realized that I have become my own worst enemy. Although when I started my forex journey, being a conservative trader helped me a lot with growing my small account, now when my experience has grown enormously, I can see that I lose more money because I am so loss averse, instead of me being wrong. So... I have decided to open another - smaller account     ( £ 500) where I will implement more aggressive approach to all my trades.

I also won't be taking any profits out of it so that I can properly monitor the account growth. I will trade this account for not less then half year. And if this account makes me more profit than my primary  - conservative account I will start applying the same strategies there as well. 


2) Increasing my risk percentage.

Comparing my actual returns with potential returns I would have made if only my maximum risk percentage was only 1% higher, I discovered it would have yielded me a total of 28% !!! more money than I actually made so I've decided to increase my maximum risk per trade to 3% of my account equity.


3) Choosing the right time frame.

Although I more often than not trade of H4 and daily charts I am sometimes tempted to go to lower time frames to look for trades. Unfortunately, my results drop almost proportionately the time frame I choose to trade. My winning percentage for all the trades I've made in time frames under H4 is a mere 32%, comparing to my overall winning percentage of 76% over the year. And although these smaller time frame trades have yielded me a total of 0.65% account growth over the year I am considering that it could have happened due to a simple chance and it just as well could have gone the other way.

So... I have another rule that goes into my rule book. DO NOT trade smaller timeframes than H4


4) Choosing the right days to trade.

Another interesting fact my journal shows is - I am bad at trading on Fridays. I know that it may seem funny for some people - but statistics don't lie. My winning percentage on trades that I make on Fridays is 43% - again, comparing this to my overall win percentage of 76%. And although I know - partly these losses come from violating another rule of mine ( DO NOT trade after 2 PM GMT on Friday afternoon), I still feel I could do more to turn this around.

So... I have decided to watch my results on Fridays more closely and reassess after the year has closed, however I will not be risking more than 1% on any trade made on Friday...


So what do you think? Do you do your journal analysis? What interesting facts have you discovered?

Please leave your comments, like and share!

Martin

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