## Steemit Crypto Academy | Season 3 Week 8 - Risk Management in Trading
introduction
I am fine by the grace of ALLAH Almighty and I hope you are all well.I am @azeem22 a student of Steemit Crypto Academy.I am going to write an assignment based on risk management in is @yohan2on Lectured Trading.Of course you will enjoy reading it, so let me start the assignment with it.
1- Define the following Trading terminologies?
•Buy stop
•Sell stop
•Buy limit
•Sell limit
•Trailing stop loss
•Margin call
Today we will talk about why trading is important for us to know. Trading is not a basic analysis. If a trader wants to be successful, it is very important for him to follow it. Today we will explain some of them. I will try my best to explain to you so that you also know what is actually called trading.
Buy stop
Now I am going to talk about which it is very important for the trader to know everything about all the details of it. If he wants to succeed in this then stop buy is a market placement order from the current market. As you can see above, this market placement order is used until the price reaches the point where any trader wants to place or place an order. Let me tell you another important thing when you arrive at the place of purchase that he has ordered. Most of the shopping stop traders use, especially when the market is bullish. If you don't understand, I have put regular screenshots below for your convenience.
Now let me tell you that all the screenshots I have put in the ad are an app called meta trader 4 which you can easily find from the play store or chrome. You can see in these screenshots. Another thing that is very important about how the shopping stop is used with the stop loss and profit taking is that when people set the values then they make some mistakes which I will tell you about it. The point is that if the purchase price should be higher than the current market price, then there will be no market order.
Sell stop
Now we will talk about sell stop. If we compare it with sell stop buy stop, it is quite the opposite. Sale stop is also a market placement order where the entry price is kept below the current market price. We read in the buy stop that the entry price is kept above the current market, so it is mostly used in the bearish trending market and when the bearish becomes a pattern of continuity.
sell stops are also used when unstable news is about to fall.
In this we will see from the screenshots above how the sale stop was placed and the stop loss.
was lower than the current market order, by following all these terms we can make an efficient trading as a corrupt trader. We will see the chart very well. We will see that a pattern of head and shoulder is being formed. With this pattern we can take the opportunity to enter from it. In this we have to look at all this carefully. You can go and find out about it in detail. The rest of the information will be found in these screenshots. I have left no stone unturned to explain in detail.
Buy Limit
Now we will talk about buy limit. Let me tell you that buying
is also a very good term to use as a corrupt trader and to follow it completely. When the buy limit is a market placement order when the price rises above the set price that you want to enter, we used the buy limit mostly when we noticed that the market is a trend. Going to review again before continuing.
Sell Limit
In it the screenshots show you a clear usage and you can clearly see the whole procedure how to use the purchase limit on the chart, let me tell you that it is mostly used at that time. Yes, there are only two cases, one is when there is a pattern of either up or down, here traders enter below or above the current price, so far the current price has passed where you wanted to place the order.
These screenshots provide us with some information on how to place a sell limit order, that a trader has to somehow keep the current price of the item, stop loss and make a profit correctly otherwise the sales limit will not place a market order. Or it brings up an error message that you can clearly see on the screenshots if you need more information about it. Well I hope your concept of sell limit is clear on how to do this. works.
Trailing Stop Loss
We will talk about trailing stop loss. In fact, what happens is that three points are very important. The first point will be moving stop loss and the second important point in it will move when the trail is your fever. I will be and the third and last point of it will be move then we have to decied how much value we have to move it means that one rupee goes to your fever then move or when it goes to four rupees then that thing We have to decied ourselves. I will understand you with an example so that you can easily understand. HTFC bank is running the share today. -5 And now at the same time I want this price to go up to Rs. 5 in my fever and Rs. 5 to my stop loss. This is called trailing stop loss. My stop loss will change. You have gone into fever but not five rupees. You have imposed a trailing stop loss of five rupees until you have five rupees in your fever. If it does not increase then stop loss will not shift further.
Margin Call
In this we will discuss about margin call. You have often heard that my account is zero and trade is closed. Due to margin call, this forex business is a business that gives us leverage. Leverage means That you have a $ 1000 balance and you take a leverage of 100 multiplied by your balance. For example, if you have a $1000 balance, you can buy and sell one dollar. This is called leverage. If we have a ڈالر 1000, we We can buy and sell for one million dollars and if we buy and sell for one million dollars, the trade will go to our profit and the company is bound to give us as much profit as we want on a $1000 that we pay the company broker or bank. But if our trade goes in the opposite direction, then our balance is one thousand dollars, we have bought and sold one million dollars, then the time when we have zero balance, then the time when our loss will be equal to our balance. Our trade auto will close and our balance will be absolutely zero, so marg the whole process is called in call.
2. Practically demonstrate your understanding of risk management in trading use a moving average trading strategy on any crypto trading charts to demonstrate your understanding of risk management.
Business planning plays a very important role in this. As long as any trader fails in his business until he is ready for the coming difficulties, the trader should be ready at all times so that he can face the coming difficulties. To face and easily access tomorrow.
Risk Management
Risk mangament is the process by which risks are managed alongside all other aspects of which business. It has already been established that risks are abundant and take numerous.
Risks can be reduced and controlled up to a point,but they cannot be entirelyeliminated, nor should organisations seek to do so. The organisation that is willing to take the risk may well be the one that succeeds overall.
Risk management is the process that identifies risks and classifies them in some way so that they can be assessed and prioritised. It then controls and coordinates the chosen response of the organisation.
Stop Loss
It will talk about stop loss. It is very important for every trader to get all the information about stop loss. Because if you have to trade in stock market or any other market, then to make profit etc. So it is very important for you to know about stop loss. Some people believe that stop loss is for hit but it is not at all. Insurance policy saves you from a big loss when the time comes. Losses also have their own method of calculating when and where to invest. Traders who make good profits say that it is very important to know about stop loss in order to make a good profit. If you want to keep your losses to a minimum, then stop loss is very important. When you do any trading, you only do it to make a profit. If there is any loss in it, how do you get out of it? For this you have to apply stop loss.
Take Profit
In this we will talk about take profit. This is what it means. Take profit means that making profit is an important part of a business. Often we keep our profits very high. We should fully adhere to the reward ratio and as a trader we should strictly adhere to this plan because if we show more greed in it then our fund can go full so we have more profit on it. Should not be greedy but should take what is.
Risk reward ratio
Whenever you trade with technical analysis, no trading can give you more than 70% accuracy no matter what you do. Every technical has to fail 10/3 times. When technicals fail, then the risk ratio is our loss. It plays a very important role in making it very small. If a technical person passes 100%, then everyone will choose this technical. Theory 1: 3 rule in risk reward ratio is very popular. Now you may be thinking that this 1 3: What is the point if you are taking a trade then your stop loss is one rupee then your target should be at least three rupees and if it is more than that it is even better and if you If you take a trade, your stop loss is 1000 rupees, then your target should be at least 3000, which means that your target must be three times more than the stop loss. This whole process is called risk reaward ratio. Goes.
Using moving average trading strategy on any crypto trading charts to demonstrate your understanding of risk management.
used a 10period moving average place a trade on EUR on 5min chart and used risk reward ratio 1:1,using 0.01 lot size.
conclusion
Risk management is the most important thing in trading which traders follow the most
Failure to adhere to the principle of risk management can lead to some losses such as loss of funds and this loss can lead to frustration and even the thought of quitting trading. And another important point is that Using Stop Loss We should use Stop Loss for trading as it lasts longer in trading.
Thanks to Professor @yohan2on for thiseffective lecture
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Thank you @yohan2on and @yousafharoonkhan for such a wonderful task.
Respected first thank you very much for taking interest in SteemitCryptoAcademy
Season 3 | intermediate course class week 8
Remarks
below read, what its meaining,,
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