Money Risk Management Strategy in Binary Options

Money Risk Management Strategy

Be aware that your money investment in Option is at risk but under own control. Every trader always uses Option in wrong way or as a game/casino because they have a strong imposed with big mentality hope that: “YOU ARE ONLY ONE WIN AND YOU MAKE A BIG WIN”. 

Instead, the successful traders never think so. They have a plan to build their capital. For example, they deposit 100 USD and make profit 10,000 USD for next month. This is sound money risk management (MRM).  

I would like to share some experiences and logic methodologies for maximizing your profit better than your expectation: There are 5 types of Money Management System: 

  Constant Based Off Capital: Traders should bet constantly 1%-5% of balance only. For example, Amount of Bet Per Trade 2%: 100$ x 0.02 = 2$. $2 is the amount of risk per trade.

This 2% amount is included lose and win.

Now you have $100 US, 

  So, you bet $2: 100-2 = 98$, first bet you lose.

  2nd bet:  98 x 0.02 = $1.96, then you win with 80% per trade. Now your balance is 99.56$

  3rd Bet: 99.56 x 0.02 = $1.99 

  Limit 10-15-20$ Loss per day based on balance: Divide it into 4 signals-1:  For example: 

($15÷4 )-1 = 2.75$ per trade 

  1st Bet: 2.75$ you lose

  2nd Bet: 3.5$ you lose

Money Risk Left for Bet: Limited Loss Balance- Total Loss: 15$-6.75$ = $8.25

  3rd Bet: 4.2$, you win with 82% so $4.5+$3.4 = 7.9$

Money Risk Left for Bet: 4.05$+ 7.9$ = 11.95$ 

  4th Bet: 3.75$, you win with 82% So 3.5$+3.07= 6.57$

Money Risk Left for Bet: 8.2$+ 6.57$ = 14.77$ 

  5th Bet: 2.75 $ you win 82% = 12.27$+5$ = 17.27$

This is example of lose in 1st and 2nd. If you lose all 15$. Please stop till tomorrow start again.

  Constant Based Off Profit; This is the similar in method with section, the difference is that this system trades on a percentage of the realized profits only ((current balance - opening balance) *0.02). When your profit has hit a threshold of about +10% to +50%, you can begin using this system to secure a long-term hold of the profits, only the profit is taken into context for calculating the risk amount. And as the profit amount grows, the risk amount put into each trade is adjusted.

  Use fixed amount: Traders decide to use fixed amount for example. 10$ per trade even she makes profit or loss. But to avoid from risk, trader need to limit loss per day. This method is used for large balance only.  

  Martingale: is used when you lose in your first trade or second trade, then when you see the next signal is the best you bet higher than previous to recover it but not biggest than the balance of percentage risks money. 

For example, you limited Loss 20$ per day: 

1. you bet 2$, Lose 2$

2. you bet 4.5$ you lose 4.5$

3. You bet 8.5$ you win 82% profit: = 8.5+ 6. 97 + 5 = 20.47$

WARNING:

Don’t trade over limited Loss

Don’t trade all time without relax and stop.

Don’t greedy and much emotional