Money Management is one of the most important factors when trading, it is the life blood of your ability to react and measure your performance when interacting with the markets appropriately. It will be a key tool that should form part of your plan and used correctly can preserve your funds so that you can trade another day. Put simple money management tells you whether you have enough money to act in the markets whether that is liquidating positions or entering new ones.

Money Management / Risk Management in our experience is one of the key factors that will determine whether you will fail or succeed in trading. There are many considerations when using money management with the two main principles being leverage and margin which are explained on the next few pages. The core principle of money management and risk is to embrace them as a positive and necessary tool that are there to help underpin the structure of your finances and how best to use them to your advantage when trading your plan or strategy.

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