Profitable or Risk Control ??????

Elvis Tangalayuk
51

Most of trader pursue profit and forget a risk behind of their trading

so, i came here to know your opinion guys.... what is really important in your trading or signal that u will copy, is it profitable or Minimize the Risk ??

Thank you guys

William Roeder
27845
William Roeder  
Once you lose your money, you can't trade. Can you lose ten (10) in a row, anytime? You must control (not minimize) your risk, if you hope to be profitable.

Risk depends on your initial stop loss, lot size, and the value of the symbol. It does not depend on margin and leverage. No SL means you have infinite risk (on leveraged symbols). Never risk more than a small percentage of your trading funds, certainly less than 2% per trade, 6% total.

  1. You place the stop where it needs to be — where the reason for the trade is no longer valid. E.g. trading a support bounce, the stop goes below the support.

  2. AccountBalance * percent/100 = RISK = OrderLots * (|OrderOpenPrice - OrderStopLoss| * DeltaPerLot + CommissionPerLot) (Note OOP-OSL includes the spread, and DeltaPerLot is usually around $10/PIP, but it takes account of the exchange rates of the pair vs. your account currency.)

  3. Do NOT use TickValue by itself - DeltaPerLot and verify that MODE_TICKVALUE is returning a value in your deposit currency, as promised by the documentation, or whether it is returning a value in the instrument's base currency.
              MODE_TICKVALUE is not reliable on non-fx instruments with many brokers - MQL4 programming forum (2017)
              Is there an universal solution for Tick value? - Currency Pairs - General - MQL5 programming forum (2018)
              Lot value calculation off by a factor of 100 - MQL5 programming forum (2019)

  4. You must normalize lots properly and check against min and max.

  5. You must also check Free Margin to avoid stop out

  6. For MT5, see 'Money Fixed Risk' - MQL5 Code Base (2017)

Most pairs are worth about $10 per PIP. A $5 risk with a (very small) 5 PIP SL is $5/$10/5 or 0.1 Lots maximum.

Elvis Tangalayuk
51
Elvis Tangalayuk  
William Roeder #:
Once you lose your money, you can't trade. Can you lose ten (10) in a row, anytime? You must control (not minimize) your risk, if you hope to be profitable.
Thank you William
Martyn Tinsley
193
Martyn Tinsley  
elvis tan:

Most of trader pursue profit and forget a risk behind of their trading

so, i came here to know your opinion guys.... what is really important in your trading or signal that u will copy, is it profitable or Minimize the Risk ??

Thank you guys

I agree with William's philosophy that risk is more important because capital preservation is the first goal. Also remember that if you lose 50% of your capital, you then have to make 100% profit to get back where you started! Not easy right?

However, once you have risk being managed well, a more advanced technique is to start attempting to maximise the profit/risk ratio. This can be done by careful consideration of the correlation between the assets you are trading (trading non-correlated or ideally negatively correlated assets), etc. This is an advanced topic, but the benefits if you can use it are significant.

If you are interested in finding out more, I have produced an entire video series of 'how to do this in MT5' and have provided numerous code samples.

You can find the video series here: https://www.youtube.com/playlist?list=PLv-cA-4O3y979Ltr9wQ2lRJu1INve3RCM

Elvis Tangalayuk
51
Elvis Tangalayuk  

Thank you Martyn


I agree with you.

Before think about profit, we think about how to control the risk..




Martyn Tinsley #:

I agree with William's philosophy that risk is more important because capital preservation is the first goal. Also remember that if you lose 50% of your capital, you then have to make 100% profit to get back where you started! Not easy right?

However, once you have risk being managed well, a more advanced technique is to start attempting to maximise the profit/risk ratio. This can be done by careful consideration of the correlation between the assets you are trading (trading non-correlated or ideally negatively correlated assets), etc. This is an advanced topic, but the benefits if you can use it are significant.

If you are interested in finding out more, I have produced an entire video series of 'how to do this in MT5' and have provided numerous code samples.

You can find the video series here: https://www.youtube.com/playlist?list=PLv-cA-4O3y979Ltr9wQ2lRJu1INve3RCM

William William
66
William William  
In some countries, the brokers must show the ratio of users are losing. Most of them are 60%, 70%, 80%. First thing to do is to prove that your system could make profit over time and then you could increase your bet to make more profit. You are trading, not gambling. 
Andi Masmuadi
114
Andi Masmuadi  
I think it's better to choose low risk than big profit but has a high level of risk. however long term consistency is more important in any business