Three Common Money Management Strategies

Three Common Money Management Strategies

The level of risk must be set before we place ANY trades on your behalf. This guide should help you.

Level of Risk

If you wish to implement the money management strategy effectively, you should primarily be able to identify the level of risk that you are willing to take on your investment. The expert traders at TBB have been effectively implementing strategies on the trades they execute. Money management allows you to define the level of risk that is suitable for your financial goals. There are usually three levels of risks that a trader is willing to take in Bitcoin trading: Low risk, Medium and High risk. For each level of risk, different strategies are designed in order to tackle them efficiently. Let’s look at some of the strategies that are widely used by the traders.

Low Risk Strategy

A low risk money management strategy is suitable for those traders, who are happy with slower growth. Low risk strategies do not trade in an aggressive market. As a result, the probability of earning quick profits also decreases. However, the major benefit of low risk strategy is that there are only low level losses.

Medium Risk Strategy

With a medium risk strategy, investors want a faster growth rate than Low Risk trading, but are not willing to or do not have enough capital to support High risk trading. The medium risk strategies trade in the markets at a moderate level. Although, with the medium risk strategy, the profits are somewhat lower than the high risk trading strategies, but there is a fair level of stability in the investor’s portfolio.

High Risk Strategy

Every investor must have heard that the higher the risk, higher the profit will be. This is true. Investors who are willing to make high profits and have the capital flexibility to do so, tend to invest in high risk trading. They realize that there can be larger losses sometimes but since they have sufficient amounts of capital investment they know they have the capital to hedge and recover when needed. With the help of high risk strategies, a trader can earn much higher profits. However, this strategy should only be taken by the expert traders we have at TBB, on behalf of investors who have ample funds for a high risk investment.

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