Study Guide for Come Into My Trading Room - Forex Factory

130 ANSWERS AND RATING SCALES
Answer 75
No. Give yourself three points for choosing the right answer.
The 2% Rule limits Susan’s maximum allowed risk to $1,000. Risking
$2.50 per share on 500 shares would expose $1,250 to risk, plus commissions
and slippage. This trade would violate the 2% Rule. Susan has
to reduce the number of shares she’ll buy. If a proven system gives her
this trade, she should take it, but on a smaller scale—300 shares rather
than 500.
Answer 76
Choice 3 is correct. Give yourself four points for choosing the right answer.
All of the choices given are helpful, but none compares in importance
with having a boss whose main tasks are money management and
discipline. People who trade well for institutions can rarely match their
performance level once they leave to trade for themselves, because they
leave the manager behind. A private trader has to be his own manager,
which is why it is essential to write down your trading plans and rate
yourself on your adherence to them.
Answer 77
Choice 2 is correct. Give yourself four points for choosing the right answer.
Record your account size at the beginning of the month. To observe the
6% Rule, you must stop trading as soon as your equity dips 6% below that
level. Stay out for the balance of the month. Your risk is at its highest when
you put on a trade; the total account risk will never exceed 6% because
then you simply may not put on another trade. Following the 2% Rule, you
may have more than three open positions, if each risks less than 2%.
Answer 78
Yes. Give yourself four points for choosing the right answer.