Mistake #1: Not using a stop-loss
The Forex market is unpredictable. Even the best analysts are wrong. Without stop-loss, a single losing position can erase weeks or even months of gains. The SL is not an option: it is your trader's life insurance.
Mistake #2: Risking too much per trade
Risking 5%, 10% or worse 20% of your capital on a single trade is financial suicide. Even with a success rate of 50%, a series of 4 consecutive losing trades causes you to lose almost 20% of the account. The golden rule: 1 to 2% maximum per position.
Mistake #3: Not adapting the lot to your capital
Trading 1 standard lot with a $1,000 account is a classic mistake. The prize must be proportional to your capital AND the distance from your stop-loss. A lot of 0.01 may be too big if your SL is far away. This is why calculating position size is essential.
Mistake #4: Ignoring account currency
An account in EUR is not managed like an account in USD. If you trade USDJPY with an account in EUR, the value of each pip depends on the rate EUR/USD. Many traders calculate their lot in USD while their account is in EUR, and end up with a much higher risk than they thought.
Mistake #5: Martingale and emotional one-upmanship
After a loss, the natural reflex is to want to 'recover' by increasing the prize. It's the martingale, and it's the open door to ruin. Each trade is independent. Your prize should always be calculated coldly, based on the expected risk, never based on your mood or your previous losses.
The solution: a mechanical process
Professional traders do not calculate their lots by hand. They follow a strict process: define the risk, measure the SL, calculate the lot, enter the trade. No emotion, no rough estimates. Signal Sizer turns this process into a simple copy and paste.
