Many traders heard the stories about making up to 500% on a single transaction. But actually, those who claim such a profit, do not tell all the truth.
First of all, the profit you make is measured from your investment amount and not your full account balance.
Secondly, it is not possible to make 500% in one transaction simply because the payouts from online trading platforms are typically limited to 60-95%. And this makes the increase in the account balance even smaller.
Let’s say you have $100 on your account and you put $5 in a single trade. If an option has a return of up to 80% it would only mean 4% for the account in general. To generate an impossible 100% increase in your account balance, you will have to open many more winning positions. And again, this isn’t really possible in a legitimate trading scenario.
That said, it is possible to increase your account balance by making smart choices. Today, I will show how you can raise your account balance in 5 days.
Key Takeaways🔑
| →Start with a smaller account balance and gradually increase it through smart trading choices. |
| →Set a daily profit goal and stick to your trading strategy to achieve it. |
| →Emotional trading can lead to losses; manage your emotions and be disciplined in your approach. |
Contents
Initial setups
The account balance you start with is important. Say for example that I will operate on an account with $100 on it. I will start small as raising with a capital of $100 into about twice that in 5 days is easier than converting $1000 into about twice that amount. Everything comes down to psychology.
It is a whole different story when you start with $100 or $1000. Imagine two traders start trading with 5% of the account balance. For the first trader it would mean $5 and for the second one $50.
Now imagine the first trade lost. It would be much easier for the first trader to invest $5 in the next trade. He can even decide to invest $10 in the hope to cover the loss.
The second trader though lost $50 and naturally does not wish this happens again. There is a psychological pressure on his shoulders and well, emotional trading is something that would most probably bring more losses than wins. So start small.
As in the example above, I will invest 5% of my account balance. With a $100 balance, it means $5 per trade. With up to 80% return, I could earn up to $4 which is equal to 4% of my initial account balance.
Let’s do some mathematics here. I start with $100. If I want to, say, double that amount, this means that means I have to earn twice that amount in a week. If I plan to do it in 5 consecutive days, I will have to make $20 per day. Going further, with each trade bringing $4, I will have to enter 5 positions in one day.
Do not forget that 5 trades for 5 days give 25 successful trades to make. It is very unlikely to open 25 subsequent profitable transactions. I will have to allow some losses to incur and then some extra trades to cover them. To summarize, we may be able to focus on making $20 every day to attain our goals.
Trading terms for my 5 days plan
I choose to trade the EUR/USD currency pair. Time will be dependent on progress. The payout should not be less than 80% (it is usually 82% on EUR/USD so we are good to go). This way it will be faster to recover potential losses. But if I experience 3 subsequent losses, I will terminate the session.
The main objective is to gain $20 every day. A single investment amount will be $5. I will hold a position open for 5 minutes and I will wait for it to expire before entering a new trade. This will help me to monitor my performance.
Pros and Cons👍👎
- ✅Starting with a smaller account balance reduces psychological pressure.
- ✅Sticking to a daily profit goal helps maintain discipline and focus.
- ❌Unrealistic profit expectations can lead to disappointment and frustration.
- ❌Emotional trading can negatively impact your trading performance.
| Daily Trading Goals | Strategy |
|---|---|
| Aim for $20 in profit per day. | Focus on making five winning trades per day, with each trade bringing in $4. |
| Use the SMA indicator for trading. | Implement the SMA indicator for better trading decisions. |
| Terminate the session after three consecutive losses. | Minimize risk and maintain a disciplined approach. |
Psychological approach
If your goal is to make $20 a day, you need 5 winning trades every day. If I manage to make it in 5 consecutive trades, I may call it a day and stop trading instantly. Further trading would only expose me to unnecessary risk.
If I do not succeed in the 5 following trades, I will continue trading until I reach my goal.
But if I lose 3 times in a row, I will stop trading.
This is how my strategy for raising the account balance. The most important thing now is to stick to the strategy I have created.
I would love to hear about your trading plans for a week, what strategies you employ, what profit you aim at. Use the comments section to tell us about your ideas.
Wish you successful trading!
Q&A: Frequently Asked Questions💡
- Q: Can I really double my account balance in just 5 days?
- A: While it’s possible to significantly increase your account balance, there’s no guarantee you’ll be able to double it. Focus on disciplined trading and setting realistic goals.
- Q: How much should I invest per trade?
- A: In this example, 5% of the account balance ($5) is invested per trade. Adjust according to your risk tolerance and account size.
- Q: What is the SMA indicator?
- A: The SMA (Simple Moving Average) is a widely-used technical indicator that helps traders identify trends and make better trading decisions.
- Q: How can I manage my emotions while trading?
- A: Develop a trading plan, stick to your strategy, and set realistic profit goals to help manage your emotions and maintain discipline.
- Q: What happens if I don’t reach my daily profit goal?
- A: If you don’t reach your daily profit goal, assess your trading performance, learn from your mistakes, and adjust your strategy for future trading sessions.