Selecting the degree of risk for to Spread Betting in Forex

A lot of people are trading in the Forex markets using a traditional broker Forex, but I knew that a lot of people prefer to trade by use spreads betting. personally I do permanently trading in a manner Spread betting and are an easy way to trade because you do not have worry about a lot of things, where you simply choose the value that you intend to use, for example, £ 1 or £ 10 for points per, for example, and therefore you enter a short or long position.

Anyway, I would like in this article to discuss how you can determine the degree of risk when you spread betting in the Forex markets and thus what is the size of the quota that you have to allocate for each point. It's simple, but it can be somewhat difficult if you are new to spread betting.

The first thing you need to do is to determine the amount you would like to use and the risk of your account in the process of trading. Common advice is not to risk more than 2-3% of the size of the account in each of the trading process; Personally, I rarely risk more than this percentage trading spreads betting, except in very rare cases when I have a very great confidence in a certain position.

Let’s suppose that you have £ 5000 in special Spread betting account, and you are ready to take the risk by 3% of the account in the whole trading process, then there will be the maximum loss of this trading is 150 pounds (3% of 5000).

The next step is to look at the stop loss point for this processing. If you intend to enter the position with a stop loss at 50 points, then you will be share by 3 pounds per point, because 50 points at 3 pounds per point gives you the maximum loss of 150 pounds, equivalent to 3% that you are ready to risk in this trading process.

And also, if you intend to put a stop loss point in the spread betting on just 15 points, you then want to engage in a position worth 10 pounds per point in order to get the maximum acceptable loss at 150 pounds.

Of course there is always the possibility that the situation does not close automatically at this stop loss point precisely because of Glide, and in this case may be lost of Spread betting process a little more than 150 pounds. But I hope that maybe I could understand the point that I'm trying to connect.

Conclusion so, if you want to determine your risk when spread betting you’ll find out how much you are willing to lose exactly based on a percentage of your capital, and then selects the number of points you want to put a breakpoint after the loss. You will then see the share of risk that will put them at every point and easy to enter later in the process of trading in the Forex.