Hi
Could anybody more mathematically inclined help with this money management question?
We know, that under capitalization is one of the causes of trader failure.
Could anyone provide us with a calculation formula or value of capital for such cases.
1. ECN broker charges 0.07 USD for 0.01 lot traded of EUR USD. How much capital trader must have, so these commisions will be negligible?
2. Other ECN broker charges 0.05 USD for 0.01 lot traded of EUR USD. How much capital trader must have, so these commisions will be negligible?
For intraday trading, he/she has 40 trades a day, so 2.8 USD for case 1 and 2 USD for case 2 in commisions only.
He/she want to trade in positions of 0.01 or 0.02 lot.
Could anybody more mathematically inclined help with this money management question?
We know, that under capitalization is one of the causes of trader failure.
Could anyone provide us with a calculation formula or value of capital for such cases.
1. ECN broker charges 0.07 USD for 0.01 lot traded of EUR USD. How much capital trader must have, so these commisions will be negligible?
2. Other ECN broker charges 0.05 USD for 0.01 lot traded of EUR USD. How much capital trader must have, so these commisions will be negligible?
For intraday trading, he/she has 40 trades a day, so 2.8 USD for case 1 and 2 USD for case 2 in commisions only.
He/she want to trade in positions of 0.01 or 0.02 lot.
Cut short your losses. Let your profits run on. David Ricardo (1772-1823)