Returns versus risk
Generally speaking, returns are proportional to the risk involved. The larger the prospect of high returns, the greater the risk of achieving negative returns will be. Investors who want to achieve returns need to take risks. Investing in Forex comes with a high risk. The goal of investing is to achieve positive returns on invested assets. The task of a portfolio manager or a trader is to achieve the highest possible return while keeping the risk as low as possible.
Leverage
Forex trading is risky because leverage is used. Forex trading is quite different from, for example, share trading. Forex trading involves a certain amount of money on an account. This amount is called the margin and makes it possible to trade. Positions that are opened lead to either profit or loss, and this amount is subsequently added to, or deducted from, the balance. Once a position in a currency pair is taken, leverage ensures that a very small movement results directly in a return of a few percent. The larger the order, the higher this profit will be.
Risk management
Forex traders determine themselves what risks they are willing to take. What is the size of the order? How many positions are open at the same time? And do the positions hedge each other or not?
Mulder FX has a well-defined trade strategy and the maximum risks are therefore clear.
Mulder FX’s strategy is reasonably aggressive, as proven by the yield history. The monthly returns (positive or negative) may amount to tens of percents. Mulder FX is currently contemplating launching variants with lower and higher risks in addition to the current managed account product. If you are interested, please do not hesitate to contact us.
