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BASiCS<br />
www.tradersonline-mag.com 04.2014<br />
risk- and Money-Management<br />
Part 4: “Trading is Not About how Often you Win or Lose“<br />
In this series of articles we present a multi-level process to create a good,<br />
sophisticated risk- and money-management plan. The fourth part deals with the<br />
fact that trading is not about how often you win or lose.<br />
Jens klatt<br />
Jens Klatt is a market analyst at DailyFX.de and<br />
moderates the German DailyFX-forum. He has been<br />
in the financial sector for over seven years. Besides<br />
technical and fundamental observation of the<br />
markets, he focuses on sentiment analysis in the<br />
forex markets and develops his trading decisions<br />
based on this analysis.<br />
www.dailyfx.de<br />
» We assume you know two traders. Trader 1 is right 40<br />
per cent of the time and achieves profit. Trader 2 is right<br />
about 80 per cent of the time and is successful with his<br />
trades. What do you think – who is more profitable<br />
Actually you cannot tell which trader is more successful<br />
or if any of these two traders is profitable at all. For example,<br />
if we assume that trader 1 achieves 200 pips with every<br />
successful trade and limits his losses to 100 pips – then he<br />
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