Money Is Emotion, Emotion is money

Money is something very powerful, would you agree that, sometimes, most of the time it governs our emotions, especially in this trading market. Loss is fear, loss is despair. Words are fun, many words are subjective and conceited.

The more money, the greater the emotional surge. So what about a 100 USD account? Of course it's not much, but compared to the demo account that you traded before, it gave you quite a lot of "sublimation" emotions.

On the first day of trading, the EURUSD pair formed a bullish pinbar candlestick at the confluence of many resistances / support / trendlines, Fibonacci resistance levels, etc. Traders consider it an A+ entry setup.

No need to hesitate with our 100 USD account, we will enter a BUY order with a risk of 2% of the account ie 2$.

After 4 days of waiting, the price hit the takeprofit and got 4% of the account ie $4. 4$ is not much, but it makes us happy, because the first time we trade, we make money.

Profit 4$ Will Make We Fail?

This world is great we have made 4% account in just 4 days. Again, it's 4% of the account, not $4.

This rudimentary thought was the beginning of a series of our future losses.

Don't want to think $4. Because 4$ is very small, it is not yet 100,000 VND. But when we think of 4%, we think we are talented, can earn 4% / 4 days, so in 1 month, can't we earn 22%? Super Profit!

A realistic and talented trader will look at absolute numbers. $4 more accurately reflects the other 4%, because after all, we're just holding a $100 investment fund. If holding more than that, 1000 $, even 10,000 $, it is not possible to earn 4% like that anymore.

Remember 4% is enough for you to trade with a 100 USD account only.

1000 USD Is Money But 100 USD Is Money

Some traders still think that 100 USD put into trading is not worth it. Just fight to get a little feeling, if you want to be rich, you have to play big, 10,000 USD for blood!

If you don't sit still, no one will naturally give you 100 USD, that 100 USD will also be earned by sweat. Besides, 100 USD instead of you putting into trading, you can buy trading books to read, buy milk for your children, take your wife/girlfriend out,... So you have to use that 100 USD to trade for real. worthy.

Don't expect $100 to make you rich. It just helps you to gain a lot of experience on how to trade, psychological experience, broker nonsense, knowledge gaps, market realities,... that a demo account has never provided. grant you. 100 USD to buy so many lessons is too cheap.

So with this mindset, the $100 account is for study, study and study. So learn how to correctly value 100 USD. Or to make it easier to understand, how to make the account burn for as long as possible to be able to learn more lessons?

Attention To Capital Management - Learning And Creating Conditions To Learn

Capital management, risk management and order management are always ignored, despised, even excluded, boycotted by new traders.

They are the keys to success, you don't need them, so what's the point of entering trading?

If a trader has the right mindset from the start, they will use their first account to practice capital management, as closely as possible. First, that trader has the opportunity to practically approach how capital management and risk management have been learned. Secondly, due to good capital management, their accounts are optimized, with little loss, if there is a fire, it will take longer to burn than other ordinary traders. How to manage capital?

1. Implement the 2% risk rule. For a 100$ account, each order only loses a maximum of 2$. Of course, the profit is not much, but the $100 candle can't get rich.

2. Trading volume is 0.01 lot, so the maximum stoploss is only 20 pips. Stoploss 20 pips is also quite ok for small time frames.

3. There should be a clear Risk : Reward ratio to easily re-statistic the effectiveness of the method you are trading.

4. Re-statistic of the win rate on the total number of orders (winrate).

5. Regularly review old transactions to learn from experience.

6. Once you have some necessary data, read more of my article to measure the effectiveness of your strategy. Later you open a larger account, you can make a profit using that method.