5 Time management trading rules to stick with

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8 Forex money management tips you need to know

When trading Forex, getting the direction of the trade right is only one side of the coin. Money management is the other side. Even the best trades and the most profitable trading strategies won’t do much if you don’t have strict money management rules in place to protect your winning trades, cut your losses, and grow your trading account. That’s why we’ve covered the 8 things they don’t tell you about Forex trading and money management that you need to know now!

What is money management in Forex?

Money management Forex refers to a set of rules that help you maximise your profits, minimise your losses and grow your trading account. While it’s pretty easy to understand the benefits of these techniques, it happens that beginners to Forex trading tend to neglect even basic money management rules and end up blowing their accounts. Analysing the market and determining whether to go long or short may be difficult enough for beginner traders, which is why I fully understand that thinking about managing your money and risk could seem boring at first.

However, without proper money management you can’t become a profitable trader. Full stop. Let’s take two traders for example – the first trader has an awesome trading strategy that is profitable 90% of the time, but doesn’t manage their risk at all. The second trader has an average trading strategy with a 50% winning rate, but utilises top-notch money management rules. What do you think, which trader will end with more profits by the end of the month? The answer is the second the trader, as the first trader will likely lose all of their profits (and perhaps even more) on a single losing trade. This is why a Forex money management plan helps a lot to succeed in trading.

Enough talking, let’s take a look at some of the most important rules of money management trading Forex.

Forex skills that are important for money management

The following list is not all inclusive and there are many more rules that can be used to manage your trades and money. However, in my experience, these tend to work the best as they directly focus on the most important point – minimising your losses.

Don’t chase the market

The first rule we’re going the cover simply tells us not to chase the market. New traders on the Forex market usually chase the market for trading opportunities and trade even on low-probability trade setups, ultimately ending up with a hefty loss. Excited by the market and their first trading account, beginners will open multiple trades in a single hour, hoping for a great profit by the end of the day. Unfortunately, this behavior resembles more a gambler than a trader.

The market doesn’t owe you anything. With experience, you’ll learn that patience is a key psychological trait that makes a great trader. You don’t have to open a new trade every hour, or even every day. If there are no trading opportunities, I step aside and let the market come to me in the next few days when a high-probability trade setup arises. Never chase the market – even a single losing trade can wipe out much of your previous profits.

Cut the losses short and let the profits run

Another important saying in the trading community is cut the losses short and let the profits run. This refers to a straightforward principle – when a trade is losing, close the trade before the losses accumulate, and when a trade is performing good, leave the trade open and have faith in your trade setup.

Inexperienced traders do it the other way around. They leave losing trades open in the hope that they will eventually reverse, and they close a profitable trade too soon on fears that the trade may turn against them and become a losing one. Fear and greed are one of the most disastrous emotions in trading, and you need to learn how to control them early in your trading career. The most profitable traders do it the professional way – they cut their losers and let their winners run.

Be cautious when trading on leverage

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A common mistake among beginners is trading on too much leverage. Leverage is a double-edged sword – it can magnify your profits, as well as your losses. It may be tempting to trade on large leverage and double your trading account every week, but unfortunately this is not how trading works. The main principle that traders need to understand is that capital protection is always first. When opening a trade, think first about the downside risks and how much you could potentially lose, and only then think about the potential profits.

The ideal leverage ratio is determined by a number of factors: your risk-per-trade, your typical stop-loss distance, and your trading account size. We’ll cover those in the following points.

Top Forex money management rules

The following two rules are critical to any Forex trader. Make sure you understand them fully before going on with the remaining points.

Risk-per-trade refers to the maximum amount of risk you’re taking per any single trade. Risk-per-trade is usually determined as a percentage of your trading account size. Let’s say that you have a $10,000 account. If you open a trade with a potential loss of $2,000 (the maximum loss if the trade hits your stop-loss), then your risk-per-trade would be equal to 20%. This example shows how not to trade. Taking a 20% risk-per-trade is way too much risk, as a strike of five losing trades would wipe out your entire account! Even two losing trades would leave you with only 60% of your initial trading account size, and guess what – it takes much more than 40% to return to your initial account size of $10,000. The following table shows how much you need to make to return to your initial account after a series of losses.

Amount of balance lost

Amount necessary to return to initial balance

Beware: 10 Time Management Rules That You Are Breaking

Breaking the rules isn’t always a good thing.

Sometimes it may seem necessary to do your own thing.

However, if you break these 10 time management rules, you are only going to waste time in the long run.

Don’t Break These Rules

Time management can sometimes be an art.

However, there are also some basic rules that can help you be more productive in your life.

Break these 10 Time Management Rules at your own risk:

  1. Multi-tasking – Multi-tasking does not lead to more things done. It leads to more things started. If you’re not careful, you’ll end up with 57 things started and nothing done.
  2. Scheduling Back-to-back Meetings – When you schedule back-to-back meetings you are practically guaranteeing that the next meeting will start late. Some companies compound this lateness throughout the day, and by mid-afternoon meetings are starting 30+ minutes late.
  3. Answering Your PhoneAnytime – Do you answer your phone when you are with other people? Your phone is only an interruption if you let it be. So, stop answering the phone when you are in the middle of something.
  4. Checking Email Incessantly – You don’t need to check email 100 times a day. Email is not intended to be instant communication. Rather, check it morning, noon, and close of day.
  5. Not Unplugging – No one can be “on” all the time. If you don’t unplug from your work and devices, you will burn out. Make sure you have clear boundaries between your work and personal life.
  6. Not Allocating Enough Time for Tasks – As a general rule of thumb, tasks will take about 2X as much time as you estimate. For tasks that you are performing for the first time, make that 4X’s as long.
  7. Too Many Tools in Your Toolkit – If you have too many tools in your time management toolkit, then you are creating unneeded complexity. This leads to confusion, searching for information (which app did I put that in?) and redundancy. Keep things simple and follow the The Power of One when it comes to your tools.
  8. Not Looking at Your List – Many people make lists only to find them later in a drawer or buried on their desk. Make sure to keep your list front-and-center. Visibility leads to action.
  9. Not Putting Things Away – Disorganization leads to wasted time. If you don’t put it away now, you’ll spend time searching for it later.
  10. Not Taking Deadlines Seriously – There is a reason why they were once called deadlines. Yet, in most organizations they are more like suggestions. By not taking deadlines seriously, you will cost yourself time, money, and opportunities. One more thing, you’re not helping yourself by extending those deadlines.

Learning the Hard Way

Breaking the rules isn’t always a good thing.

Abide by these 10 time management rules to be more productive.

Or you can do things the hard way. (Which is the method many people choose…)

Sometimes rules seem more like guidelines.

Other times, they are the proven way to get things done.

Question: Which of these rules are you breaking? What other time management rules do you follow?

11 Time Management Tips for Students

You’ve already finished high school. You’ve left home and become a college or university student. The world seems to be yours and you are the best person to shape your destiny. Whoa. Not that fast. Although your educators say “Carpe diem” (meaning to grasp the chance you’ve got now), they expect heaps of things from you. How can you “carpe diem” when you have so much to learn? It’s a question each student cares about.

You have a Hamlet moment: to study or to party? Naturally, you want to spend a lot of time socializing and getting your party on. Now you have to be more than a decent student, pulling down those good grades. Some students have real troubles with time management and can’t manage their studying schedule.

Time management techniques differ, and it’s up to you to choose the most appropriate one depending on your lifestyle. But definitely, you need to know how to use your time. The Unicheck team has come with a good, verified plan to adapt to your lifestyle.

Time management tips for students:

1. Focus on advantages

It’s easy to work if you actually like what you do. However, we often have to tackle different tasks that we totally dislike. What can we do? Absolutely any job has its pluses and minuses, so just concentrate on pluses. Draw up a list of advantages you’ll gain after the work is done.

2. Plan in advance

Plan your time well. Plan out which tasks you need to do and who you are going to meet up with. First thing each morning, or sometime during the previous day, deciding what you are going to do the following day. Follow your plan as closely as possible.

3. Limit time

After your daily plan is ready, block out segments of time and allocate how much time you need to dedicate to each of your assignments. This will let you plan your spare time as well.

4. Prioritize

You can’t cope with all the tasks simultaneously, so define which of them are of major and minor importance. When this numbered list is ready, either get down to finishing off the less important things or postpone them to another day.

5. Don’t digress

Lots of things are going to distract your attention. And your task is to say “stop” to them. Social media, phone, new messages – all these things steal time from you. For example, you could be ready with an article in an hour, but when you constantly pay attention to some incoming texts, before you know it, two hours have passed and the article isn’t done. It’s better to work first and then have some time for messaging.

One more important thing is to focus on only one task. Don’t overload yourself with several assignments, concentrate on one of them – this way you will be able to work more effectively.

6. Have time for rest

Take small breaks between your tasks. First, your work-in-progress will be more creative if you’ve had some rest previously. And second, one way or another you need to relax and have a cup of coffee. Don’t forget to include short breaks in your daily plan.

7. Don’t be a perfectionist

If you pay too much attention to small details, you simply waste your time. It’s better to work without pauses for some time and after you end up, single out 10-20 minutes to work on details.

8. Sleep enough

Your concentration and productivity directly depend on your sleep. Some people prefer to sleep less and work longer, relying on coffee and energy drinks to keep going. Soon their bodies and brain fail to function well. It is best to avoid this trap. Your body needs around 7 – 9 hours of sleep.

9. Start working early

Some people adore working early in the morning, some like to work at night. No doubt, it’s important to listen to your biorhythms and fulfill tasks when convenient. However, we recommend working just after you woke up – your mind is fresh and sober, you don’t feel exhausted. Who knows, maybe you’ll like working in the morning.

10. Use organizers

To become focused, one needs to effectively use organizers and timers. It’s easy enough to find the most suitable for you. Download calendars, notepads, time controllers or other stuff which you find good for your work. Easy to use, they can be synced with your computer or phone without difficulty. Check out our comprehensive list of time management tools for scheduling, prioritizing and minimizing distractions.

11. Keep you deadlines in mind

Mark in your calendar or reminder exactly when you have to hand in a paper, article or assignment. This will give you extra time to check and proof-read. So, aim for an earlier deadline.

Time management skill is a precious thing. If you have it, you’ve gained a great advantage over your classmates. Thanks to the time management tips listed above, you can develop it step by step and see results right away.

For useful recommendations on how to relax and pass tests without stress and depression, check out our recent post Skills of Managing Stress before Tests is a Good Thing to Gain.

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