Skip to content

Investment Control Strategy

A lot of digital options traders are currently making use of a percentage based money management strategy. This strategy is straightforward, necessitating only that traders choose a set amount of their total account funds for use in each investment. This is generally a percentage amount ranging from 1-10%. This strategy provides self-adjusting investment sums for good times and bad, and thus a higher degree of financial control.

Your task is going to be to settle on a reasonable investment percentage. One way in which to make this decision is to ask yourself just how quickly you’d like to build your account funds. Higher percentages won’t necessarily help you to accomplish this if you’re not trading well, but if you are, a higher rate may be the best choice. Your personal comfort level can also play a role.

Needless to say, the decision making process involves a bit more than just selecting a percentage. You may also need to consider your average daily account balance, typical daily trade volume, and more. Do not hesitate to opt for a lower percentage rate if you’d like. There is nothing wrong with slow and steady profit growth. If you really think about it, you can use a lower percentage along with a higher trade volume to build profits at am impressive rate. A little more effort will be required, but many take this approach.

Do give some thought to your overall success percentage. Hopefully you’ve been tracking this on your own, but if not, you may be able to derive a figure from your digital options broker platform. If you are profiting on a monthly basis, you may want to consider a higher rate. Keep in mind that you are never locked into keeping the same rate. You can always make adjustments as you go along. As you gain more skills and experience, you’re likely to experience more success, and with more success should come more profits.

If you’re new to digital options trading, beware of the temptation to commit large investment amounts to single trades. It can be easy to convince yourself that certain trades are going to finish in the money, when the truth is that there is no such thing as guaranteed profit in the investment world. Fund stabilization should be your primary concern while you are in the beginning stages of trading. Sure, you can re-deposit funds should you drain your account, but why would you want to?

Financial control is important whether you are trading digital options or participating in any other form of investment. It’s never too late to form a money management plan, so act now if you’ve yet to forge out your own personal plan. Even if you decide not to opt for an investment percentage strategy, there are other sound solutions which will allow you to protect your account funds while you trade digital options for profit.


Leave a Reply