But before we begin you need to ask yourself whether you are a long term trader or day trader. If you are looking to trade the market in the higher time frame, then you are on the safe side of this investment sector. But if you are seeking to trade the lower time frame with bigger lots than this advance knowledge of risk management factor will save an enormous amount of money.

## Trailing stop loss features

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## Precise entry and exit point

When you look for potential trade setup, you must keep in your mind that no matter what happens you can’t afford to risk more than 2% of account capital. But in advance money management, this 2% rule is not applicable. Not even a single broker can give you the guarantee about exact stop loss price execution. You might have some slippage due to high market volatility. For instance, if you have traded the GBPUSD pair during the Brexit news than chances that you will obviously have some massive slippage during the dramatic market volatility. But if you risk less than 1.5% then even after having massive slippage in your stop order execution you will be fine.

## Lot size calculation

Let’s begin with an example. For your \$1000 trading account, you know that you should never risk more than 2% of your account capital. The scalpers in the Forex market have 10 -20 pips for each trade whereas the long term deals often have more than 100 pips stops. So how do the professional traders bring the variation with their lot size? Here is the calculation

For 20 pips stop loss, we will use 0.1 lot size. So if the trade goes 20 pips against us, it will be closed with a 20\$ loss.

Similarly, for 40 pips stop loss we will use 0.05 lot size. So if the trade goes 40 pips against us, it will be closed with a loss of \$20

You need to know your pip value and stop loss price level before you can determine your lot size. Some traders often ignore this rule in the Forex market, and at the end of the day, they remain on the losing side. Lot size calculation is not all complicated rather its simple arithmetic. You don’t have to learn rocket science to find the perfect lot size your trade. Just know your account type and stop loss price level and rest is just simple math.

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There are two types of traders in the Forex. One type of trader always loves to trade the technical trading signal, on the other hand, the second category is the news trading. News trading is something very different and risky in the financial world. During the event of a major fundamental news release, the Forex market becomes extremely volatile. Most of the new traders think that they can trade the news data very quickly, but when it comes to real life trading, they become the ultimate loser of this industry. However, if you still want to trade the news, then you need to consider three things very strictly.

1. Severity of the news
2. Trend of currency pair or financial instrument
3. Technical levels of the market