Equity

The equity in a trading account is its cash value if all open trades were closed immediately. 

Equity = cash in account + floating profits of open trades – floating losses of open trades.

The main uses of equity are that it shows how much your account is really worth right now, and how much you should risk on your next trade if you are sizing your trades based upon a fraction of account equity. This position sizing strategy is arguably the most robust form of money management which a Forex trader can use. Read more ...

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