What Lesson We Must Learn From CHF Collapse? & How We Can Perfectly Protect Our Investment In Forex?

If you ask a professional trader how to protect your investment in Forex, the answer will be invest money you can afford to loss & Forex is not for everyone.

Brokers bankrupt & Big Fund Managers lost almost all the money according to Reuters last week... It was a catastrophic move which need to open our eyes that our money in any Forex account with any broker is not safe, so how we can protect our selves as small traders from a catastrophic trap from big players to make everyone loss in the future, same as what happened last week? 

The best risk management approach for solving this danger in the Forex market is to create a bridge between your ordinary bank account & your Forex account where you will be always transferring in & out money during your weekly trades between those 2 accounts & we will take as a Forex investment  example 10000$ to explain this safe risk management strategy, which protect your investment in case your broker bankrupt.

Instead of risking all the 10k with a broker, a trader can specify 10k for Forex trading & keep them in his ordinary bank account, and for trading where he will be risking 2% or 5% he will transfer to the Forex account with the broker only 10% of the specific amount for trading... where the 9k remain as a back-up for the trader when needed yet in his safe ordinary bank account.

1- This strategy offer the trader safety in case the broker bankrupt where he will not loss 10k and just the exposed 1k present in the Forex account with the broker.

2- When the trader have only 1k in the Forex account instead of 10k, he will not let one trade grow in lost more than 1k... as normally traders if they have the 10k in a Forex account they might let the lost grow till reaching 50% if not 80% from the origin investment.

3- In this way the trader will be investing money he can afford to loss only the 10%.

4- In case profit is made it's strongly advised to withdraw the profit to the ordinary bank account & to keep only the 10% from the origin investment as exposed money in the Forex account.

It's the best risk management strategy a trader can use to avoid future brokers meltdown, & keep on enjoying Forex trading by controlling perfectly all the risks exposed in the Forex arena.