Practical Formula for Money Management

Having so much importance on a Money Management in trading, I tried to share this formula a little, as a basic description.

This formula is to determine the LOT that will be used on MT4 brokers that use 5 digits.

Information :
BALANCE = Capital
RISK uses 1% (can use between 0.1% to 2%)
SL (Stop loss) can use 25-50 PIP (it's up to each trader)
OP is done = 4 times the OP with a ratio of 3 loss: 1 profit

FORMULARS are as follows:

Lot = ((Balance x Risk) / OP) / SL

For example $ 100 capital
The formula is:
Lot = (($ 100 x 1%) / 4) / 25
Lot = 0.01

It is better if the SL uses a distance of 25 pips, then the TP distance is 100 pips.
If 3 x OP loss with the amount of $ 0.75 and when you TP at OP 4 with a profit of $ 1, of course you still get a profit of $ 0.25.

It looks small, but with MM that is good and right, it is certain that the funds we run can be far from the large Kerigian

this is an example of a Money Management Model

Having so much importance on a Money Management in trading, I tried to share this formula a little, as a basic description.

This formula is to determine the LOT that will be used on MT4 brokers that use 5 digits.

Information :
BALANCE = Capital
RISK uses 1% (can use between 0.1% to 2%)
SL (Stop loss) can use 25-50 PIP (it's up to each trader)
OP is done = 4 times the OP with a ratio of 3 loss: 1 profit

FORMULARS are as follows:

Lot = ((Balance x Risk) / OP) / SL

For example $ 100 capital
The formula is:
Lot = (($ 100 x 1%) / 4) / 25
Lot = 0.01

It is better if the SL uses a distance of 25 pips, then the TP distance is 100 pips.
If 3 x OP loss with the amount of $ 0.75 and when you TP at OP 4 with a profit of $ 1, of course you still get a profit of $ 0.25.

It looks small, but with MM that is good and right, it is certain that the funds we run can be far from the large loses

this is an example of a Money Management Model

Having so much importance on a Money Management in trading, I tried to share this formula a little, as a basic description.

This formula is to determine the LOT that will be used on MT4 brokers that use 5 digits.

Information :
BALANCE = Capital
RISK uses 1% (can use between 0.1% to 2%)
SL (Stop loss) can use 25-50 PIP (it's up to each trader)
OP is done = 4 times the OP with a ratio of 3 loss: 1 profit

FORMULARS are as follows:

Lot = ((Balance x Risk) / OP) / SL

For example $ 100 capital
The formula is:
Lot = (($ 100 x 1%) / 4) / 25
Lot = 0.01

It is better if the SL uses a distance of 25 pips, then the TP distance is 100 pips.
If 3 x OP loss with the amount of $ 0.75 and when you TP at OP 4 with a profit of $ 1, of course you still get a profit of $ 0.25.

It looks small, but with MM that is good and right, it is certain that the funds we run can be far from the large loses

this is an example of a Money Management Model

hello, what about if we deposit 50$ and use lot 0.01, and got floating, and what is the great moment to cut lose and take profit ? because i got panic somehow ? i kind of confuse about this money management thing

thank for your advice bro, i have already open a micro account right now its only 100 usc though. but i try to learn, using money management to control in forex

yeah, after losing in real account last year i try to find a way to learn forex even more and go into market rather than using demo, so i found this micro account thing and try that, its better than demo you gain real money if profit haha

I don't agree with your review, because every trader has a different calculation, but the statement can be used as a reference for money management.

Thanks for you for your money management formula.

I make a formula for management that is very low risk where the loss limit that I explained is very small and I am sure all traders want to implement it, unless indeed they want to trade with a high risk level