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ADAMSMITHS
How to deal with your trading slippage
posted Dec 28 '17 by adamsmiths
How to deal with your trading slippage

It is not a lie if we mention that most of the naïve traders in the Forex market face slippages when trading but what about the Forex professional traders? The professional traders are making lump sum through trading but don't they face slippages? Well, the traders in the United Kingdom make it clearer by stating that they have taken necessary steps to avoid slippages. So, in this article, we are trying to help the naïve traders by mentioning the ways to reduce the slippages in the Forex market. You should not assume that professional traders never face slippages, of course, they do but they make sure to take necessary steps to not to face further slippages. Actually, there are some naïve traders who trade the market even if they face slippages but on the contrary, there are some traders who leave the market because of the slippages. Our target is to revive the traders who leave the market. There are two things you must understand if you want to reduce slippages in trading and they are such as proper understanding of the market orders and types of orders. Now, let us dive in.

Role of money management
Every single trader knows that without having a clear knowledge about money management it’s almost impossible to survive in the financial market. If you look at the professional traders in the United Kingdom then you will be surprised to see that most of them are trading with less than 2% risk per trade. You might have all the trading knowledge yet you will have to face some losing trades. Never get frustrated by seeing the losing trades since it’s just a part of your trading career. Be patient and wait on the sideline for the best trade execution. If possible learn price action trading since it is often considered as the most reliable way to trade the key support and resistance level. Place your trade in favor of the market trend to reduce the risk exposure.

What are market orders
You should have the proper understanding of the market orders because they are great if you want to exit trades but then risky if you want to enter trades. So, the market order is used when buying and selling depending on the market price. You would already know that the market is highly risky so you should take every step carefully. When you are entering a trade you should make sure to study the market at the best you can. Many naïve traders fail in trading because of not understanding the market so what should the traders do? They should spend some time in demo trading account ( https://www.home.saxo/en-gb/platforms ) so they will be able to practice trading without losing money. You should understand what market orders mean and then try to demo trade until you get it clear.

What are limit orders
The term limit order is foreign to naïve trader so they tend to fail in the market because of not knowing it. The limit order means the order time. Actually, there are times when you should not use the limit orders because of certain reasons. You should not use the limit orders if you want to place stop losses. The limit order is great to prevent slippage in trading but you should use it wisely if you want to earn profits. There are risks in using the limit orders so you should make sure to focus on the risks when trading.

What are the negative factors in limit orders
There is one negative factor in the limit order and i.e. if the price doesn't reach the limit order you may not be benefitted. Even a downside factor can be turned out as a positive factor if the trader has the ability to understand the market. Through limit orders you can get the best prices but ONLY if you use it wisely.

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