Risk / Reward Important Part Of Forex Money Management

Forex trading is a game of probabilities, traders who learn to view and think about trade setups In terms of risk to reward,are the ones who usually end up making money in the Forex market. Defined trade setups at the right place and time is definitely a necessary ingredient to Successful trading.However, it is possible to make consistent money even if your discretionary Trade setup identification skills are not fully matured yet. Risk to reward setups are what give all Traders an equal chance at making consistent money.

Risk to reward  is one of the most important pieces of the puzzle to profitable trading.And proper amount of self-discipline and emotional control.

Learning to think in probabilities and to view the market in terms of risk to reward, it is Necessary to calculate the risk on a trade, then you can calculate the reward as a multiple of the Amount you have at risk.

Concentrating on the risk first making you more aware of the risk involved on each trade setup.

Risk level for this setup is 40 pips  the distance from the low to the high of the pin bar.We will figure 1$ per pip for the example so the risk is 40$  and the profit potential for 2times  Risk is 80$ 3times risk is 120$.

Getting a risk / reward At least of 1:1 or 1:2 on every trade, you can lose on well over 45-50% of Your trades and still make money.

Now we learned from this article is that you can make still money in the forex markets even if You lose more trades than you win.