Want to know how to reach your Forex income goals in 2015?
It's a new year, so this means a new chance to set goals and achieve them. So what I thought I would do with my first Forex blog post of 2015 is show you exactly what I plan to do to reach mine.
Step 1 - Know Your Numbers
This is the most important thing you need to know. "What are my numbers"? This is what allows me to take all the other steps. And how I will reach my Forex goals this year. If you don't know your numbers, I will use some example numbers below. I will also add an example goal milestone below too.
How much is my account balance? $10, 000
What is my risk to reward? 4:1
How much do you risk per trade? 2%
How much do you make per trade? 8%
How many trades a week will you take? 15
How many trades will you take a day? 3
What is your Forex trade hit rate? 40%
There are more numbers you can have but these are the bare bone essentials you need. If you don't have answers to these questions before you trade, it's going to be hard for you.
Regardless anyway, you can use the framework in the example questions above to make something which works.
Simplifying The Numbers
Based on the numbers above, in 2015 we would take 3 trades a day and no more. Based on our hit rate, every week we will win 6 trades at 8% return = $4, 800. And we will lose 9 trades at 2% loss = $1, 800. With a positive risk to reward, you don't need more winning trades to make money. Based on this, you will make $3, 000 profit = 30% return. By the end of the month you would have basically doubled your Forex account and some.
When you know your numbers, it is quite easy to plan forward.
Although the lucrative thing about Forex is compounding income, I like to plan numbers based on the same account size. For example week 2 would be $13,000 and would mean you make more money, but we will leave it based on a $10,000 account. This allows you to enjoy a nice surprise when you are making more than you expected. This also caters to the fact of living off Forex profits.
Step 2 - Plan Out Your Year
The second thing you need to do is plan everything out. Because once you know your intentions, you have a step by step guide. We kind of done this a bit in step 1 but we only focused on one week.
Next you need to draw this up for the whole year or at least a 6 month period. It will look something like this.
This example table above simply follows the plan of 15 trades a week ( 6 wins (8%), 9 losses (2%)). If you follow that formula you only need about 1 winning trade a day. A 40% hit rate is not the hardest to do, nor is it the best accuracy. But you can see by planning, what results you can get.
You can see through the results above that consistency pays very well. But don't just get carried away by numbers because at the start that's all they are. NUMBERS. This leads us into step 3 which is the most vital.
Step 3 - Take action
This is the most important part of the equation. If you don’t take action, you will NEVER make these kind of results. Action is the key. With the examples above, it is really easy to take 15 trades a week and make 6 winning trades. You don't need a special amount of wins to make money. But think about the week you have a good trading week and you get 10 right or 12. There is tremendous upside to this with limited downside, but if you never take action you will be like most who don’t believe and never try.
It's a new year and now is as good a time as any to start something and finish it strong. This is why I recommend you seriously consider going through my All in one Forex course now. I will show you how to pick out trades worth 8% profit. Take the course now, Not in 6 months when you are not hungry for Forex success like you are now and you regret not starting now.
January provides a different kind of motivation than really any other time in the year. Make the most of it and go through the course now.