Can percentage trading give us good returns?

<p id="isPasted">Percentage trading, also known as position sizing, refers to the practice of allocating a specific percentage of trading capital to each trade based on predetermined risk parameters. While position sizing is a crucial component of risk management, it alone does not guarantee good returns. The profitability of trading relies on a combination of factors, including trading strategy, market conditions, timing, and risk management as a whole.</p><p>Proper position sizing helps control risk by limiting the potential loss on any single trade, which is important for preserving capital. By allocating a percentage of capital based on risk tolerance and stop-loss levels, traders aim to protect themselves from excessive losses.</p><p>However, the success of trading and generating good returns depends on the quality and effectiveness of the overall trading strategy. Position sizing is just one piece of the puzzle. Traders must also have a well-defined and tested trading strategy, conduct thorough market analysis, identify suitable entry and exit points, and manage trades effectively.</p><p>Other factors that contribute to trading success include psychological discipline, emotional control, and continuous learning and improvement. Managing risk through position sizing is a crucial aspect, but it needs to be implemented within the context of a comprehensive trading approach.</p>

<p id="isPasted">When trading forex, there is no specific percentage that is considered "good," as it can vary depending on several factors such as the individual trader's risk tolerance, trading strategy, and overall market conditions.</p><p>A profitable forex trader, on the other hand, is thought to aim for a high percentage of winning trades and a low percentage of losing trades. Many successful traders aim for a win rate of 60-70%, which means they profit on 6 out of every 10 trades.</p><p>Furthermore, the total amount of profit or loss on a trade is determined by the size of the trade and the number of pips gained or lost, not the percentage of the trade.</p><p>It's also worth noting that having a high percentage of winning trades does not guarantee profitability, as the percentage of profit from winning trades should be greater than the percentage of loss from losing trades. This is known as the risk-reward ratio.</p><p>It's always a good idea to have a solid risk management plan in place before you start trading and to be aware of the risks that come with forex trading.</p>