Often, people nest the query – “How to grow a small trading account successfully”. Most probably, you are also one of those curious minds, with an ambition of growing their small trading accounts, with minimum risk involvement. Now, that we know that Forex trading is a very risky process, it also leads to a lot of psychological distress, when the under-capitalized accounts get hit by losses. Of course, we wish to have a well-funded account, but, we need to grow our small accounts slowly and with a lot of discipline and a refreshed attitude towards the markets, so that we can be sure that we have a buffer against the losses which steal away our sleep.
We all know, that we cannot make a million dollars in 4 weeks, so we need to jot down our goals and our expectations. We cannot become a doctor in 2 days, similarly, we cannot learn to trade in 2 days. First of all, we need to see that the market must be traded with interest of being at minimal risk, not passion of a need of making money. Risk management and money management remains a priority in the strategy that one needs to hold for growing one’s account successfully.
These are a few steps, which would easily anchor your trading account to the harbor of success. One must trade using leverage as it allows small account traders to trade markets that they cannot trade using cash. It should not be used to increase the number of shares involved with your account, but should only be used to reduce the trade’s margin requirements. One must trade conservatively as we lack the capital to make trades with higher risks. Also, one needs to adhere to the One Percent Risk Rule as it could provide a small account with the same buffer as a large account as it is a very effective risk management technique.
Besides that, one needs to create a trading plan, with some proven trading methodologies, get clear on how they work and stick to them. A consistent track record, moreover, is a gift in disguise as it can help an individual get other investors to make money out of one’s trading account and when the individual has been successful, one could try doing the same for the investors and charge a percentage of benefit.
One has to learn to treat the small trading account as, say, 1 million dollars account, and when one is that meticulous about handling it, the losses will go down and one can focus on risk management strategies, like the one percent rule, and hence, make the most out of it.
But, the action that one needs to take right now, has to be to gather all the courage to pick up the motivation to work hard across the lines of discipline to strategise and control the stress that the small trading account will give you. If you are head-strong about growing your account successfully, one needs to glue together the proper trading culture and work on it. Most traders say, under-capitalized accounts are a failure and run into heavy losses, let’s prove them wrong!