{"id":20157,"date":"2023-02-08T20:49:57","date_gmt":"2023-02-08T20:49:57","guid":{"rendered":"https:\/\/mdr.foobrdigital.com\/?p=10647"},"modified":"2023-02-08T20:49:57","modified_gmt":"2023-02-08T20:49:57","slug":"calculate-what-your-maximum-account-drawdown-is","status":"publish","type":"post","link":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/2023\/02\/08\/calculate-what-your-maximum-account-drawdown-is\/","title":{"rendered":"Calculate What Your Maximum Account Drawdown is"},"content":{"rendered":"\n

Understanding and using a smart\u00a0drawdown\u00a0level can help stop you from blowing your account or putting huge chunks in it.<\/p>\n\n\n\n

You may decide that if you lose 25% of your account, it is time to take a break and work out what is going wrong. You may decide to move back to a demo account to find what errors you are making before moving back to your live account.<\/p>\n\n\n\n

Having a drawdown level set where you will have a break can help you have a clear rule set around when it\u2019s time to pause risking real money.<\/p>\n\n\n\n

#3: Create a Ruleset for How You Take Profit and Use Your Stop Loss<\/strong><\/h3>\n\n\n\n

Many traders have clear rules around what trades they will take, but they don\u2019t have clear stop loss and\u00a0take profit rules.<\/p>\n\n\n\n

You only win or lose money when you close your trade, so it is crucial you have a clear rule set that outlines how you take profit or cut your losses short.<\/p>\n\n\n\n

This ruleset can help you minimize your losses and take advantage of the larger winners.<\/p>\n\n\n\n

#4: Create a Money Management Plan and Follow it<\/strong><\/h3>\n\n\n\n

The best\u00a0trading plan\u00a0will be written down with a clear rule set that is easy for you to follow.<\/p>\n\n\n\n

Your money management plan should include rules around;<\/p>\n\n\n\n

    \n
  • How much leverage you use.<\/li>\n\n\n\n
  • How much you risk in percentage or money terms.<\/li>\n\n\n\n
  • What your acceptable account drawdown is.<\/li>\n\n\n\n
  • What minimum risk-reward you will try to achieve for each trade.<\/li>\n\n\n\n
  • How you will use correlation.<\/li>\n\n\n\n
  • How you will set your take profit and stop-loss levels.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"

    Understanding and using a smart\u00a0drawdown\u00a0level can help stop you from blowing your account or putting huge chunks in it. You may decide that if you lose 25% of your account, it is time to take a break and work out what is going wrong. You may decide to move back to a demo account to […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[297],"tags":[],"_links":{"self":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts\/20157"}],"collection":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/comments?post=20157"}],"version-history":[{"count":0,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts\/20157\/revisions"}],"wp:attachment":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/media?parent=20157"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/categories?post=20157"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/tags?post=20157"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}