Risk Management – How to avoid losing your shirt while trading forex

Pharaoh from the Forex Peace Army Forum wrote an interesting forum posting that I think all of you novice forex traders should definitely read. Here is a brief excerpt of it. For the rest I invite you to visit the original posting.

Have you ever seen things like these on a website or in a review?
“I followed those trading signals, and my account dropped 70% in 3 days.”
“I tried this method and got margin called in less than a week.”

Let me put this simply. It doesn’t matter if some trading method, trading room, signals service, or anything else has a perfect reviews and a 5 year history showing that it never had a single losing trade. It doesn’t matter if it’s endorsed by Felix, Crazy Cat, Sir Pipsalot, me, and the heads of the IMF, ECB, and the US Treasury. Not matter what “proof” is offered, no matter how well endorsed it is, no matter what the guarantee is, DO NOT EVER RISK TOO MUCH OF YOUR ACCOUNT ON ANY ONE TRADE.

Click here to read the rest of this posting.