The Best Forex Compounding Strategy that Works

Are you searching for an effective forex compounding strategy? Read our article to find out which is the best forex compounding strategy that works!

The best forex compounding strategy that works

One of the things that can supercharge your returns is “going in for the kill.” What I mean by this is adding to your positions as they work out. Far too many traders are afraid to have a position run for a longer period of time and want to take profits as soon as possible. However, if you learn to add to winners, you can pad your account with large gains, and allow for several losses as you occur them. Remember, you are looking to make money in the long term, not just the occasional smash and grab situation. By adding to your winners, you can buy yourself a lot of losers. I mean by this is that if you have a 10% gain in one trade, and a couple of 1% losses after that, you are still making money. The easiest way to compound your account is to add to what’s already working.

Obviously, you need a trend to follow at that point, but there are plenty of trending markets in the Forex world at any given moment. In fact, that’s one of the things that makes Forex so attractive, the ability for markets to trend for years at a time. When you are in a trend and get a slight pullback, it makes sense that it’s possible we are going to see a bit of value chased. On those dips, add slightly. By doing that multiple times, you your gains when you have things working in your favor. Obviously, you should never add to a loser, which unfortunately is what a lot of retail traders will do, in the hope of earning back some of their losses when the market turns around. That is the quickest way to ruin, because it supercharges your losses. Do not be afraid to add to your winners, it separates the long-term winners from the rest of the crowd.