Forex trading became popular because it was viewed as a highly lucrative investment option where even an investor with a small amount of equity can make big profits with trading currencies because forex trading allows leverage. Forex leverage is the feature that magnifies gains or losses resulting from changes in the prices of currency pairs. [...]
Surely, you must have read it countless times: never risk more than 2% of your equity in forex. But what exactly does it mean? How do you compute that and translate it into number of lots, which is how traders speak the language of forex? Let’s assume that you have USD 10,000 of equity in [...]
Forex investors should know how to evaluate investment strategies based on the risks that their accounts are exposed to based on forex drawdown. Forex drawdown is the amount, either in absolute value or percentage terms, of decline in a forex account’s equity through the course of trading. For any given instance that a position is [...]