About a year ago, a friend lamented that he was struggling forever not knowing how to make a profit in the trading market, he traded in real gold. After learning about the person, the current trading method, his mindset, etc., giving advice is the most practical. After a while, about a month ago, she said that she had recovered the lost capital, calculated as a percentage of profit, reaching 300-400% of the original account. Then yesterday, she said that she was losing again and again, losing direction, feeling like gambling, not knowing what to do. This hurts all the time. So is trading easy or difficult? How to be successful? This is a question many people ask. But the answer is also undetermined.

Most of us who come to this field hope to make money, even a lot of money, hope with wisdom and experience to grab everyone's money with the least amount of money possible. But we also know that very few people do that. According to some statistics, only about 5% of people succeed in this market, a number that is too low. It is not known whether that number is right or wrong, but the majority of participants fail is undisputed. Let's try to find out the reason.

In fact, lectures on technical analysis methods, trading systems, problems on risk control, psychological control, and lessons on sharing experiences of success and failure abound on the internet. forums, websites about trading, securities. But also the fact that it has not solved the core problem for the majority: the question of how to be successful.

Find out more and find it has a reason for it: people with money, they are smart investors; We have to look at ourselves.

What is the crux of the matter? Right now, I feel like I'm on the right track. Let's try to see the problem: why do large investors, financial institutions, and investment funds set a profit target that is not very high, like a few tens of % per year. So we look at ourselves, how much profit target are we setting. Many of you, especially those who are new to trading, often set very high goals, several tens of %/month, even double or triple the account. Many of you give reasons to comfort yourself that if you have a few %/month, how can you afford coffee? But perhaps you do not realize that that is the key point leading to nothing.

In the market, there are usually two main types of traders: medium and long-term trend traders and daily traders. And it seems to match 2 types of people: investors and gamblers (There have been many articles about these subjects but only shared from a subjective point of view). Why say that, investors often have a long-term strategic vision, while gamblers can only look at their daily trading results. Correspondingly, when trading according to the medium and long-term trend, you will have a very broad view, understand the market better, understand clearly at what stage and what to do. As for only daily trading in a short time frame, in the short term, when the market is stable and the trend is clear, profits will increase very quickly. But when the market is side way in a short time frame or not oriented for a few weeks then that will be the time when the market will take back all your profits, even your entire account. Once in this vortex, it is very difficult to get out. The results are almost predetermined. There is one more thing that many people do not anticipate, that is trading addiction. There have also been many articles about this, when you can't stop placing a few orders regardless of how the market is doing, you are addicted. And the habit of typing more and more commands, the easier it is to become addicted. This is also a big cause of failure.

Now let's re-analyze a bit of trading theory, there are 3 elements necessary to ensure success:

1. Master a method of technical or fundamental analysis or an analysis system that guarantees a 50% win rate or more.

2. Good risk management, control SL, TP, volume of orders, risk ratio of each order/account, number of trade orders at a time, number of trade pairs.

3. Practice good trading psychology.

This is the forward problem, what about the inverse problem? Starting from the profit target to come up with the above numbers.

1. Set a high profit target: Then the volume of 1 order/account must increase, the number of orders increases, the risk ratio is high, or the risk ratio remains the same, the number will be small, leading to Trends trade on short timeframes and will follow in the footsteps of Daily traders. Another consequence is that it is very difficult for those who trade according to this goal to be psychologically stable. When they win, they will win big, so they will be very excited, leading to subjective psychology, thinking that winning the market is too simple. After that, some losing orders will come (and losers will also lose big volume), the head will heat up, the market revenge will appear. Next, you will either lose your way or pay the price with your whole account. These are all effects that are closely related to each other according to the law of cause and effect. Very difficult to avoid. Thus, when setting a high profit target, it will lead to two important factors of instability. Then failure is predictable.

2. Set a reasonable profit target (usually around 10%/month return). A low profit target doesn't mean you can't make higher profits, but then you are satisfied with the results you achieved.

In contrast to when setting a high profit target, then the volume of 1 order/account will be very small (I am currently trading 1k account, the volume of 1 order is 0.01), the number of orders at a time is less. a lot (usually up to 3 to 5 orders, currently limited to 3 orders, when the SW market is only 1 order), SL each order is very large, 200 pips or more. So, of course, you will have to trade on a large time frame: D1, W1, MN. H1 and H4 are only used to determine the entry time.

It can be said that trading in this time frame has a frighteningly small risk ratio. There was a time for almost a year when I didn't need to use SL but the profit was still very good. It is for this reason. The corollary of this approach is psychological stability. Because a correct order sometimes lasts a whole month, I can only make a profit of 4-5% (mosquitoes), so it's normal. On the contrary, when the market is unpredictable like last month, if you hit the wrong order continuously and lose, there is also nearly 10%, small matter, do it again next month.

3. In both cases, the trading system is not mentioned. Because in my opinion every system has its own reason, there is no absolute winner, it will be suitable at a certain time, for a certain type of person. The trader's mandatory task is to find a system that works for him. Strictly speaking, the successful person is the one who understands himself best, and is the one who wins himself. However, in my opinion the trading system is not the decisive factor for success. It's just like when you go to school, you have to be able to read and write, that's all, you can't do anything if you can't read and write, but knowing is not a terrible thing. That is why successful traders, the winning trade rate also only needs to be at 50% or more.

The above is a personal view of how profit target setting will affect trading style and the risks encountered. Of course, the choice of time frame depends on the personality and circumstances of each person, but in general, in order to reduce risk, it is advisable to limit trading on a short time frame and have an overview of the market. called multi-timeframe analysis). People often advise not to try to fight the market, find a way to understand the market.

The question is, if you set such a low profit target (about a few %/month or a few tens of %/year), with a small amount of capital, will you ever be able to make coffee money? I also thought a lot about this issue and finally figured out my path. Now pose two situations like this:

1. You have a large capital to start a business (about a few tens of k or more), so setting a moderate profit target is too reasonable, still ensuring the safety of your account and the income is still very good. However, there is another way of managing capital that is "standing on the shoulders of giants", you should not trade all your money yourself, but should find really potential traders to follow, and consider yourself just one of the that trader. This will greatly reduce your account risk, especially if you are not experienced enough with large capital management.

2. What if you have small capital (about 500 U to 1 k)? It is still recommended to set a moderate profit target, but the goal is to practice to become a pro trader, a reliable trader. For what? To find ways to attract investment capital from financially capable investors, investment funds. Your job is to create an account with a good history (not needing too large but stable profits) in a few years. Then there will be many opportunities for you. There are many places where you can look for opportunities like this, like Zulutrade, MQL5, Myfxbook….There are many, but I am particularly interested in Darwinex right now. It is a great environment for you to develop your career. There are 2 reasons I prefer Darwinex:

One is that there is a very professional account analysis tool here (the most pro in the brokers I have ever known). It will analyze the pros and cons of each aspect of your account, especially how risky your account is. And if you orient your trading style to meet its criteria, you will gradually become a pro trader.

Second, here you have a lot of opportunities to find investors to follow you, including retail investors and especially investment funds. Including the floor's allocation fund. Every month they spend 4 million Euros to invest in the top 48 people according to their monthly evaluation list (called DarwinIA). And you will be entitled to 20% of the profits you make for them. You absolutely can do it. In fact, there are some traders on my forum who can do this. For example, the DYX account, last month, was also allocated 40k of the exchange's investment fund (you can learn more about the topic: "Please review Darwinex" on the forum).

There is another chance when you have a good enough history. That's when you upload your account to sites like Myfxbook, MQL5… there are many investment funds in the world looking for talented traders on these sites. When they see that your account matches your target, they will find you by themselves.

This is a case where a fund once sent an invitation to check their eligibility to join the fund.