Trading forex can be a complicated business, which is one of the reasons it offers the opportunity to make such large profits (as well as losses). For many traders they can soon get in a bit of a rut and find their performances stop improving, even after weeks, months or years of trading.
There are a number of things that you can do to improve your trading performance. You may not necessarily be doing anything wrong, just need to try something different and change your approach, as well as making the most of everything youâ€™ve learnt so far.
- Work on Ratios
Improving your win rate and/or your reward to risk ratio should see trading performances improve. It provides a greater chance of ending up more profitable in the long run but it can lead to a poor win rate that makes the change not worth it.
Increasing the ratios to something like a 3:1 reward to risk ratio would mean that even if you only win around half your trades the profits are still higher. You will need increased funds and a personality not afraid of upping the risk, as if it all goes wrong your performance will dip.
- Change Your Platform
By switching tools you could discover that the trading platform youâ€™ve been using all this time has in some ways been hindering your performances. For part-time traders, having a trading account that can be used on various devices, such as smartphones and tablets, is a necessity to make trades on the go and stay up to date with the latest news and events affecting the market.
Check out whatâ€™s available, as some trading platforms will feature the most up to date news, charts and analysis which helps you make the most efficient trades. Some are easier to use than others as well, saving you time to think through trades a lot more.
It could just be that youâ€™ve become too complacent and are not challenging yourself with trading. Diversification is important when trading anything, so it may be worth expanding your currency portfolio to trade other major or minor pairs.
Step outside of your comfort zone to improve your trading skills and use what you learn to improve your current trading strategy. Of course, trading more currency pairs does increase the chance of making losses, but it also improves the chance of making more profits.