Smart Ways to Avoid Big Slippages and Boost Profitability
Slippages are inevitable in trading. When you place an order to buy or to sell at a specific price point, you may notice your filled price is marginally different to the price you have set. Slippage can be either positive that means the price fill is in your favor, but most often, one will only find negative slippage on trades.
It is normal to see slippage between 5 to 6 pips round trip on major pairs and 8 – 12 pips for cross pairs. This may seems small but if you are trading like 100 trades a month, such slippages can seriously eat up a big chuck of your profits.
I have carefully aligned my trading strategy to ensure I have the least impact on slippage and here is my secret.
Work with a highly Reputable and Regulated Broker
This is critical. The success of Genesis Asset Monitor trading is also influenced by the broker I choose. I pick my broker that has Tier 1 liquidity providers (LP) as their clients. I work with the best in the industry. You need a large numbers of LPs in the pool to ensure the execution time and price fills are rapid and precise.
With a large pool, I have less issue with spread widening and my trades are closed at the price I want, give or take a little.
Longer Trading Timeframe
Genesis Asset Monitor trades on a longer timeframe. My profit target is roughly 250 pips or even more. This approach really mitigate the issue with large slippages.
Here is a simple example. On a typical scalping strategy, if you bought EURUSD for 1.2000 and plan to sell at 1.2010. This 10 pip move may earn 2% on your account. But the broker only able to close at 1.2005 due to slippage. So, the net gain is just 1%, you have given away 50% profit! Imagine if the slippage is 20 pips or even more.
My trade will be quite different, I buy the same EURUSD at 1.2000, but my exit will be 1.2250, that’s 250 pip move. When I sell with a 5 pip slippage, at 1.2195. My slippage will be 5/250 or 2% of my total gain potential. Even a 20 pip slippage would hardly affect the profitability of my system but other systems may suffer badly.
This is one of the key factors why Genesis Asset Monitor produces extraordinary results.
Avoid trading around News Events
We often see webinars and talks giving advice on how to trade the news. In my case, I totally avoid trading news events. During major news events, I have seen slippages can balloon to 40 – 60 pips and under such volatility, most trades can end up as big losers just because their orders get filled at the wrong price.
Knowing how slippages can impact the profitability of your strategy is important. If left unchecked, slippages can significantly eat away a big part of your profits.
Genesis Asset Monitor has independently verified performance record.
Our FX portfolio has been producing exceptional returns for our clients since 2016.
Fully compliant with US CFTC FIFO and Hedging rules
the new EU's ESMA mandate on leverage restrictions
We will be holding You
in Your trading conquest!!
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Copy trade system at Signalstart
The key advantage of copy service is not having to spend countless hours each day to find trades and manage them.
This forex strategy has already recorded over 200% returns in 2017. This year, the portfolio is already making several winning streaks and it is on track to produce another outstanding result by end of 2018!
Also, you have a top trader and money manager, Ramesh, who has a vested interest in your success too, since he has his funds invested in his Genesis system.
There is no need to purchase any expensive trading software or attend a seminar to learn about new strategies which usually would not come with any track record of its success.
Track record is paramount. Genesis Asset Monitor has a solid record. When we purchase a new car, we do ask about its quality of build and performance. Then, why in trading, you have to trust or believe a software or system without any verified proof? Genesis copy system is changing that.
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About the author
Ramesh is an active trader producing over 200% gain in 2017 and author of 3 trade strategy development books sold on Amazon. He is the creator the 10/20/30 Rule™ that could transform a mediocre trading system to become a top performer by following a systematic and thoughtful approach on strategy development.