Trading Account Management

The steps below explain how to set up money management for gold trading. They also offer tips to build your own system for handling account equity in gold trades.

1. Hold Extra Reserve Beyond Online Broker Margin Needs

This reserve is needed for unusual situations and it should be not less than 50% of invested equity. It's the first rule of account management in margin trading definition for opening orders. However, many experts and analysts advice more reserve of about 70 % - 90 % of invested account capital for safe operation in xauusd.

2. Do not to invest more than 2% - 6%

A fundamental rule to avoid bankruptcy is to ensure investments in a single market do not exceed 2%, while total open trade positions should remain under 6%.

3. Risk No More Than 2% of Capital on One Trade

This differs from the 5% rule above. Here, cap losses at 2% per trade. A gold trader then risks just a tiny bit of capital on bad deals.

4. Diversify

Use optimal investment of your funds is that you should diversify to some degree. Just In case one trade losses, the order can be covered by profits of another trade.

5. Write Down Clear Money Rules for XAUUSD Trading

Write it down on paper or in your plan. Any trades you take must follow your gold money rules and limits.

6. Define your stop loss & takeprofit levels

When you are trading put your stop-losses in order to avoid any huge losses. profit taking levels will ensure you get additional profit by taking money out of the market. Analyze the situation & predict the future movement direction of the price action & open orders accordingly. You can even use indicators and volatility of the price to know where to place these orders.

Why define your possible loss or profit before opening a trade?

Consider only opening trades when you've got the chance to get profit against loss ratio of 3:1. If you can't do it then don't open the order.

Good gold money management aims for max profits in the account. Hold winning trades longer as a smart move. Profitable orders lead to strong results.

Follow Your Trade Plan Rules for Opening and Closing Orders

That way you'll get consistent results required for making profits in market.

9. Do-not revenge against the market

In this case, you'll not be interpreting the situation but you will just be based on emotions and you'll lose more money.

10. Timely rest

Skip trading if you feel tired. Even if it looks good, you might miss gains. Trade on your normal schedule instead.

Considering these - Trading Account Management Rules and Guidelines can make you trade profitably. Try to develop your own equity money management strategy that provides you with good trading profits.

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