How good is your strategy?
Never think that a complex trading system will help you to become a successful trader. Most of the time the new traders are looking to build a complex trading system to make their life better. But people in the United Kingdom are very smart. They believe in simplicity. Instead of developing a complex structure, they always try to keep things simple. Even if you use the key support and resistance level, you can easily make a huge profit. You don’t have to worry about losing trades in the retail trading industry.
Test your trading system
Before you jump in the exchange traded funds community, you need to backtest your trading system. Without knowing the performance factors of your trading system it will be nearly impossible for you to deal with your losing trades. Always try to protect your investment and focus on the quality trade execution. Try to become a member of the professional UK trading community since it is one of the easiest ways to protect your trading capital. Focus on the market dynamics and trade the market with confidence. Never trade the market with a system which you have not tested.
Run it through in different markets
The best way to know if this strategy can be used in other markets is running it through in different markets. We know Forex market is different and you may think why one strategy will be used in other markets for testing. This is because sometimes a strategy is developed for the wrong market. Traders do not even understand the strategy they have been working for is best suited with the markets they have not traded. To know if you have done the same with your strategy, run it in demo accounts in other currency markets. The result will tell you if this strategy needs more work or this strategy is good for the time being.
What are the risks to reward ratios?
Risks to reward ratios is the best way to know if this strategy is going to bring profit or wreak havoc on your account. If you are using the strategy that is soaking up all your investment, you should not use it anymore. If you want to know if your strategy is good, place trades and see how much money is at stake for your profit. Although this risks to reward ratios is related to your trading mindset also but not all strategies can be used for your risk to reward ratios.
What is your success rate in the last month?
If you do not want to analyze the strategy for its success and failure, a glimpse into your past month trading history is enough for you. It will tell you how much successful trades you have made with this strategy. If you do not like the number, try to work on it or use a new strategy.