Stop/ Limit Orders- Find Out That The Strategy Method Uses Stop Orders

Category: Finance, Currency Trading.

There are a number of things you should study when performing a forex system comparison.

History- Does the system vendor provide a history? There are a lot of forex system vendors out there, this top 10 list will assist you to pick the one right for you. A good strategy method provider should be able to tell you the systems monthly results for at least the past year. Draw- down- Unfortunately Draw- downs are unavoidable in trading forex. If the strategy method hasn t been available for a year, ask what the back- test results were. There are a lot of forex systems making 1000 s of pips per year, but they fail to advise you that you could have lost all/ most of your account before making those 1000 s of pips. Consider the emotional impact of the draw- down, would you have given up?

Always check what what draw- downs the system has had in the past and use this to determine how much you are going to trade to ensure your account is not wiped out. Reviews- Search to see if other traders are trading the same forex strategy method. Find out if the strategy method has its own forum and have a look at the feedback the strategy method is getting. Have a look what others are saying about the system. Often existing users have found a better way to trade the system by tweaking it, check what the latest settings are before you start trading. The profit is in how they manage the trade, by cutting losses short and letting profits run. Win Ratio- Professional traders often have a win ratio of close to 50% .

A system with a high win ratio is not necessarily better and can be too good to be true. A stop order should be set to minimize your loss in case the trade turns against you. Stop/ Limit Orders- Find out that the strategy method uses stop orders. With no stop order set you could face a huge loss. This will give you a chance to get used to the strategy method until you feel comfortable with it, and give you an idea if it is worth trading with real money. Paper Trade- Before trading any strategy method with real money you should paper trade it, or trade it using a demo account.

Many systems can also be back- tested to give you proof of how the strategy method performed in the past. You should also check what hours of the day you need to be at your computer to trade the strategy method. Timing- Find out what kind of time commitment the strategy method requires and study how this fits in with your schedule. Money Management- What kind of money management strategy method does the strategy method use? Additional Costs- Find out what additional costs you will incur to run the strategy method. Systems that recommend you increase your trade size after a loss are not generally recommended by the trading community.

Does the strategy method require a specific charting package or data feed to run? 1Refund- Find out if a refund is offered and what the conditions are and if they can be met easily. Good luck with your forex system comparison.

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