Risk Management Techniques
Trading in the financial markets carries a real risk of losing money. We all understand this perfectly well, but what should we do to make real money, despite the risks inherent in this industry?
Let's take a look at a list of some of the rules to follow to reduce your risk. It is quite possible that you may have used these methods without suspecting that they are valid risk management steps.
Use a stop loss-order - This tool is priceless in the matter of risk management - protects your trades from unexpected market movements. So when you enter a position in the hopes that the asset will rise in price, but it actually decreases, and the asset reaches your stop loss price then the trade will be closed to prevent further losses.
Use a take-profit order - Take Profit aims to automatically close a deal when a certain profit is reached.
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