How to achieve a minimum risk in trading?

Each investor is aimed at obtaining the maximum possible level of income, but at the same time he remembers and takes into account the risks. However, often a trader misses this parameter and tries to improve the yield curve. As a consequence, there is a violation of the established risks, an increase in drawdown on the account, as well as a decline in financial indicators, including mathematical expectations.

This problem pursues not only beginners, but also really professional fix api traders. To deal with it, you should set a number of restrictions and apply them directly in your trading plan or trading strategy. It’s about risk and money management. Thus, set the following rules:

  1. Transaction risk;
  2. Risk per day;
  3. Risk per week;
  4. Risk per month;
  5. The maximum amount per trade operation;
  6. Parameters of volume selection based on generated trading signals;
  7. And so on.

Each rule must be based on the trade strategy specification and we strongly recommend you to apply them in your fix api trading. However, these rules are often ignored because of what the risks are violated.

Understanding what each speculator and investor is facing, we have found a way of controlling risks, which consists in laying these parameters in a direct trading algorithm. Thus, create a robot that would not tolerate drawdowns and loss of funds. Moreover, a robot, which would conduct the trade directly at the closing of all transactions and there would not be a situation when the balance grows, and the funds remain at the same level. For this we needed an algorithm (trading strategy), which would satisfy our requirements.

In this issue, we also found a solution in the form of automation of the fix api arbitrage trading strategy.

Arbitration consists in the simultaneous analysis of the same financial asset, but on different stock exchanges. Speaking about the fix api forex market, the brokerage companies can act directly as a stock market. The algorithm itself has minimal risks, as transactions open at the time of the largest exchange rate difference in two brokers, and close when the minimum values are reached. Thus, the trader, as well as the investor, receive a guaranteed positive result with minimal risks.

However, we went even further and created an algorithmic system that does not have any risks. We are talking about our software Fix Api 2-Leg Arbitrage . The trading robot conducts a continuous analysis of identical quotations on different fix api MT4 trading terminals. When there is an exchange rate difference between the identical currency pairs, the robot opens a deal to buy at the site where the quotes are lower and sells where the quotes are higher. The software can hold positions from seconds to minutes until the opposite situation arises with arbitration or the price changes to the required value or until a certain time. We created the software in such a way that the broker could not determine your arbitration transaction.

Using access to the FiX financial protocol allows you to increase the result by analyzing the values ​​of the currency pair directly to the liquidity provider, and not in the trading terminal. This approach reduces slippage and conducts analysis without mark-ups of brokerage companies, because in the arbitrage trading, each profit point has a significant share in the formation of future profitability; therefore, relevant market data are needed.

Thus, using an algorithmic approach that already contains key rules for capital management, as well as a trading strategy with minimal risks for working in the fix api forex market, we created a product that is suitable for both passive investment and diversifying the manager’s trading risks.


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