How to replenish a trading account ?

Hello, my friends’ forex traders!

Today we talk about not the most obvious aspect of trading - account replenishment. Yes, you’ve heard right. Money management does not just position size management, but also depositing and withdrawing funds. In this article I will try to clarify how to deposit money to the account: if it is worth depositing much, how to leave the comfort zone and a little secret that will save you a lot of nerves and banknotes.

I have 100500 currency units. I want to trade and make money!

A typical beginner mistake in Forex. He opens an account, deposits $100 on the first day, usually accidentally earns $20-30, and the calculator is turned on in his head. “Well, then, in one day I made $ 20, so weekly I can earn 100 and 400 monthly. And if I deposit $1000? Then I’ll get 4,000 a month. And if I sell granny’s apartment (nobody lives there anyway) ……… Hey, Buffet! Wait for me!!!!!!! Soon we’ll be comparing our accounts!! ”

Don’t do it. Even if you have those 100500 of money that you’re going to invest in trading, do not just deposit them to your account. Even if you are successful, your strategy is perfect, you have balls of steel and 24 hours of free time per day. Now you’ll understand why.

Quitting the comfort zone

There is such a thing as “Comfort Zone”. It is your usual way of behaving, lifestyle, recreation, etc. Any deviation is a way out of this zone. If you jump with a parachute, and previously did not do that, or come to a pretty girl (or boy) and invite her/him for a cup of coffee, but usually do not do - all this will be the way out of your comfort zone.

If you are familiar with the training on personal growth, then you know that usually, they practice an abrupt exit from the comfort zone. For example, if the training on time management, you will drastically start living on a schedule to count every minute and rest only at certain times, etc.

And if it’s training for confidence development, you may be given the task to take away a phone from a passerby (later to return and apologize).

Once the training is over 90% of the participants return to the normal rhythm of life. 10% continue to use some techniques, such as to-do lists, but on the whole, nobody behaves the same way as on the training. Why?

Because the exit from the comfort zone was too harsh. And you, like a spring, returned back.

How does this relate to trading? Very directly. Once you start trading for the unusual amount you, get out of your comfort zone too far and too fast, and immediately get a punch in your face.

The reason is moral unpreparedness and lack of experience in dealing with large sums of money. And … the universe) Call it quantum physics, “The Secret”, whatever you want. But once you start earning too different from your previous income, immediately you get a punch from the universe. Tested by many people, including me.

Therefore, revenue growth (and deposit) must be gradual.

So, even if you have a great business, you have spare money, luck is on your side, etc. - you shouldn’t put the whole amount at once. Gradually, by 10-20 percent per month, we are increasing the size of the deposit. In the process of trade a lot of nuances and complexities that you’ve never been aware of, reveal, and you will thank yourself multiple times for having followed this principle. Quitting the comfort zone in the trade and income will be gradual and will contribute to your growth as a trader.

Feeding a running horse

The next method will be useful to those who trade in a number of strategies and/or Forex expert advisors.

Let’s say you trade “Green Red Candle” once a day, trying to scalp on M1, and you also have night advisor-scalper and some robots downloaded from the Market in the MT4 terminal. You have all these systems on different real accounts, with $100 on each account.

You have some profit on “Green Red Candle”, scalp finishes at about zero, night scalper provides a small but steady growth, an advisor from the Market loses a lot (like all EA’s in the MT4/5 market).

 

Question: on which of the accounts the deposit should be increased? Naturally, on those accounts, which are growing. “Green Red Candle” account shows growth? Increase the account. Gradually, it is not necessary to deposit all that you have. There is profit on night scalper? It’s deposit also should be increased. Scalp doesn’t work out? Well, you do not need to deposit the money into it.

The next thing important for your morale, but perhaps not the most efficient in terms of deposit growth. If there was a profit in the past month - increase the deposit. There was no profit- do not increase.

I understand that this is not entirely correct, because if there was a drawdown in a given month, you can increase the deposit and compensate losses with the same lot… But! For moral stability, you need your profit. Only then, the increase of the deposit. Otherwise, get a punch from the Universe))

Systems’ Commissions

I’ll be a “Mr. Obvious” for some time. Pay attention to the broker and payment systems commissions when depositing and withdrawing funds. They are usually listed on the broker website, sometimes even on a separate page. Because sometimes commissions are inadequate and may even “eat” all your monthly income.

Take care, Michael

ForexTraderPortal.com