⚡Fixed Fractional Vs. Fixed Lot Money Management

A tried and tested approach is the concept of money management which can be the game-changer in helping you get to your trading goals.

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Why money management is important?

Losses is a part and parcel of trading. The trick here is to be able to limit your losses and find the appropriate money managing strategies to suit a situation.

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Money management not a guarantee of sure fire success and high profits but is an assurance against mounting losses in a difficult market. At the same time you need to keep an eye on the volatility of the stock and how much money needs to be put at risk on any one position

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What Is the Fixed Fractional Model?

Fixed fractional or fixed risk is a money management strategy where the risk is restricted to a fixed percentage of the account. Only a fixed part or percentage of the account capital gets exposed to risk.

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Pros Of the Fixed Fractional Model

The ability of this model to capitalize earnings is borne by the compounding effect. In winning streaks the position size begins to increase. But in losing streaks the size of the trades reduces.

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