Account Size Matters

When I first started trading Forex, like most traders I had a small account. I think my first deposit was like $25 with Tradersway, or maybe $50 or so. Like most traders starting out, I blew it in two or three days. If you haven't already heard of it, there is something called the 90/90/90 rule. It states that 90% of traders will lose 90% of their account balance in the first 90 days of trading. I'm here to tell you it's true lol.


90/90/90



Obviously, I was just starting out so I knew it would happen. But I didn't know it would happen again, and again, and again, and again, and again, and again, and ok you get the point.

But why? Was I the world's worst trader or was there something deep dark hiding in the shadows working against me? Were the brokers secretly plotting, sharpening their teeth at a chance to shred my account into pieces? No.


The problem I had was my account balance was waaaaaayyyyy too small. You see when you have a small account balance you think like a trader with a small account balance. It's like going to a casino with $20 thinking your going to play the penny machines all day and actually come back with more money than you started with. The penny machines have the worst odds in the casino. That's because they are there simply to have fun. No real gambler goes to Vegas to play penny machines.


Minimum Account Balance


My suggestion is to put no less than $1000-$5000 in your account. For some, this will be a sacrifice. I get it. But sacrifices must be made. Risk must be taken. The reason small accounts fail again and again is that you are chasing a dream. Now yes it is possible to flip or compound your account quickly. I have done it a few times, but it's not easy. Trading isn't easy either. Small account traders are looking to make a return that is way easier to achieve with a larger account. Example: If you trade 5 lots you can gain $250 to $500 in a matter of 30 mins or so. with s small account that amount could take days or even weeks. So your account size plays a huge role in how quickly you can make the returns that you would consider good. If you place a trade and are up to $250 in 15 minutes you can close it and enjoy your day. If you have a small account you are constantly afraid that you will lose a big percentage of it, so you tend to stare at charts all day. So consider taking some time to build your balance and trading bigger lots if you ever want to make any real money in Forex.

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